# In the matter of Aliasgar Mohammed Lokhandwala vs. Dalmia Group Holdings Company Appeal(AT)(Insolvency) No. 1060 of 2019

> NCLAT judgment dated 2019-10-16. Citation: TCN-2019-NCLAT-00211. The appeal was filed by the Director/Shareholder against an order admitting an application…

- **Court:** NCLAT
- **Order date:** 16 Oct 2019
- **Citation:** TCN-2019-NCLAT-00211
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/aliasgar-mohammed-lokhandwala-vs-dalmia-group-holdings-company-appeal-b7d79250

## Summary

### Background

The appeal was filed by the Director/Shareholder against an order admitting an application under Section 7 of the IBC, which initiated the Corporate Insolvency Resolution Process against the Corporate Debtor.

## Facts

Dalmia Group Holdings, the Financial Creditor, filed an application under Section 7 of the Insolvency & Bankruptcy Code, 2017 against Lokhandwala Kataria Construction Private Limited, the Corporate Debtor. This application was admitted by an order dated September 19, 2019, issued by the Adjudicating Authority (National Company Law Tribunal), Mumbai Bench. This admission initiated the Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor. Aliasgar Mohammed Lokhandwala, the Appellant Director/Shareholder, informed the National Company Law Appellate Tribunal (NCLAT) that a settlement had been reached with the Financial Creditor on October 10, 2019. This settlement occurred before the constitution of the Committee of Creditors. The written

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## Issues and analysis

### Issue 1: Whether the impugned order admitting the Section 7 application should be set aside given the …

**Ratio:** An order admitting a Section 7 application under the IBC can be set aside if a settlement

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**Reasoning:** The Tribunal noted that a settlement had been reached between the parties and the

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**Interpretation:** Rule 11 of the NCLAT Rules 2016 grants inherent powers to the Tribunal to pass

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**Application:** Given the settlement and the appellant's commitment to pay the IRP's costs, the

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## Parties

- **Judges:** S.J. Mukhop…; Kanthi Na…; +1 more
- **Appellants:** Aliasgar Mohammed…
- **Respondents:** Lokhandwala…; Dalmia Group…
- **Advocates:** For Appel…; Arun Kathpalia,…; +10 more

## Timeline

- **September 19, 2019 — Admission…**: Adjudicating Authority (NCLT, Mumbai Bench) admitted the Section 7 application against…
- **October 10, 2019 — Terms of Settlement…**: The Appellant Director/Shareholder and the Financial Creditor reached terms of settlement…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

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