# In the matter of Ashwani Kumar Chandrakar vs. Central Bank of India & Ors. Company Appeal (AT) (Insolvency) No. 606 of 2022

> NCLAT judgment dated 2022-10-14. Citation: TCN-2022-NCLAT-00156. The case involves an appeal against an order related to an insolvency resolution process…

- **Court:** NCLAT
- **Order date:** 14 Oct 2022
- **Citation:** TCN-2022-NCLAT-00156
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/ashwani-kumar-chandrakar-vs-central-bank-of-india-ors-company-appeal-05e94c63

## Summary

### Background

The case involves an appeal against an order related to an insolvency resolution process initiated by Central Bank of India against a corporate debtor. A key asset of the corporate debtor, a hospital and medical college, was acquired by the State of Chattisgarh under a State Act. The acquisition involves compensation to be paid by the government, potentially sufficient to cover the corporate debtor's dues. The appeal concerns the continuation of an interim order and the consideration of the compensation amount in the insolvency proceedings.

## Facts

Central Bank of India initiated insolvency proceedings against a corporate debtor. The corporate debtor owns a hospital and medical college in Durg, which was acquired by the State of Chattisgarh under the Chandulal Chandrakar Memorial Medical College Acquisition Act 2021. The acquisition mandates compensation to be paid by the State, potentially two times the valuation of the assets. The appellant contends that this compensation will be sufficient to settle the dues of the Central Bank of India and other financial creditors. The Adjudicating Authority admitted the Section 7 application based on debt and default. The appellant argues that the Adjudicating Authority should have considered the acquisition and the compensation amount. The Interim Resolution Professional

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority erred in admitting the Section 7 application without considering …

**Ratio:** The Adjudicating Authority should consider all relevant factors, including the

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**Reasoning:** The court reasoned that the Adjudicating Authority should have considered the acquisition

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**Interpretation:** This legal issue concerns the scope of the Adjudicating Authority's discretion

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**Application:** In this case, the court found that the Adjudicating Authority should have

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## Parties

- **Judges:** Ashok Bh…; Alok Sriv…; +1 more
- **Appellants:** Ashwani Kumar…
- **Respondents:** Chandulal…; Central Bank of…
- **Advocates:** Anitha S…; Ajay Ma…; +9 more

## Timeline

- **2022-05-27 — Initial Inter…**: Appellate Tribunal entertained the…
- **2021-09-03 — Gazette Publ…**: State Act 15 of 2021, acquiring the…

## 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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