# In the matter of Asia Motorworks Holdings Ltd. Vs. Nitin Madhukar Bhate & Anr. CA(AT)(Ins)No.1127-2019

> NCLAT judgment dated 2019-10-25. Citation: TCN-2019-NCLAT-00184. This is an appeal against an order passed by the Adjudicating Authority (National Company Law…

- **Court:** NCLAT
- **Order date:** 25 Oct 2019
- **Citation:** TCN-2019-NCLAT-00184
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/asia-motorworks-holdings-ltd-vs-nitin-madhukar-bhate-anr-ca-629adccb

## Summary

### Background

This is an appeal against an order passed by the Adjudicating Authority (National Company Law Tribunal), Ahmedabad Bench, Ahmedabad, which admitted an application under Section 9 of the Insolvency and Bankruptcy Code, 2016. The Corporate Debtor, AMW Motos Limited, reached a settlement with the Operational Creditor, Nitin Madhukar Bhate, by 21st October, 2019. The parties informed the Adjudicating Authority about the ongoing settlement negotiations. However, the Adjudicating Authority passed an impugned order dated 22nd October, 2019, admitting the application under Section 9. The Operational Creditor, Nitin Madhukar Bhate, appeared in person and confirmed that he had received the settlement amount.

## Facts

AMW Motos Limited ('Corporate Debtor') and Nitin Madhukar Bhate ('Operational Creditor') reached a settlement by 21st October 2019. Nitin Madhukar Bhate had filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016. The Adjudicating Authority, Ahmedabad Bench, was informed about the settlement negotiations. However, on 22nd October 2019, the Adjudicating Authority passed an order admitting the application under Section 9. Nitin Madhukar Bhate appeared in person before the NCLAT and confirmed that he had received the settlement amount of Rs. 30,07,188/- from AMW Motors Limited. He also filed an affidavit stating that he had instructed his Advocates to withdraw the proceedings. The Interim Resolution Professional had not yet taken charge. The

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## Issues and analysis

### Issue 1: Whether the impugned order dated 22nd October, 2019, passed by the Adjudicating Authority, should …

**Ratio:** Rule 11 of ‘NCLAT' Rules, 2016 allows the appellate tribunal to exercise its inherent

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**Reasoning:** The NCLAT reasoned that since the Respondent (Operational Creditor) had taken a stand to

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**Interpretation:** This implies that the NCLAT has the power to set aside orders of the

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**Application:** The NCLAT applied Rule 11 to set aside the order of the Adjudicating Authority

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## Parties

- **Judges:** S.J. Mukhop…; Venugop…; +1 more
- **Appellants:** Asia Motorworks…
- **Respondents:** AMW Motos L…; Nitin Madhukar…
- **Advocates:** Abhijit…; Himan…; +3 more

## Timeline

- **2019-10-21 — Settlement…**: AMW Motos Limited and Nitin…
- **2019-10-22 — Impugned Orde…**: The Adjudicating Authority passed an order…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 9 — Application for initiation of corporate insolvency…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-9)

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