# In the matter of Kannan Tiruvengandam Vs. M. K. Shah Exports Ltd. & Ors. CA (AT) (Insolvency) No. 203-2018

> NCLAT judgment dated 2019-07-26. Citation: TCN-2019-NCLAT-00412. The case pertains to a Corporate Insolvency Resolution Process (CIRP) initiated under Section…

- **Court:** NCLAT
- **Order date:** 26 Jul 2019
- **Citation:** TCN-2019-NCLAT-00412
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/kannan-tiruvengandam-vs-m-k-shah-exports-ltd-ors-ca-725b3804

## Summary

### Background

The case pertains to a Corporate Insolvency Resolution Process (CIRP) initiated under Section 7 of the I&B Code against ‘Assam Company India Ltd.' (Corporate Debtor). After following the procedure, Resolution Plans were received by the Resolution Professional. An Interlocutory Application was filed seeking relaxation of eligibility criteria for prospective Resolution Applicants, specifically regarding the minimum tangible net worth. The Adjudicating Authority referred to an advertisement and observed that the Resolution Professional had left avenues for modification of the terms and conditions. The Committee of Creditors had already considered the matter and prescribed the minimum tangible net worth.

## Facts

The Corporate Insolvency Resolution Process (CIRP) was initiated against ‘Assam Company India Ltd.' under Section 7 of the I&B Code. After following the necessary procedures, Resolution Plans were submitted. An Interlocutory Application was filed by ‘M/s M. K. Shah Exports Ltd.' seeking relaxation of the eligibility criteria for prospective Resolution Applicants, specifically concerning the minimum tangible net worth requirement of Rs.400 crore. The Adjudicating Authority addressed the matter, leading to an appeal. The Committee of Creditors had already considered and prescribed the minimum tangible net worth. ‘M/s M. K. Shah Exports Ltd.' withdrew from the contest as a Resolution Applicant. The Resolution Professional received four resolution plans after the stay

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority has the jurisdiction to decide the requirement of minimum …

**Ratio:** The Adjudicating Authority does not have the jurisdiction to decide the requirement of

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**Reasoning:** The court reasoned that the determination of eligibility criteria, including minimum

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**Interpretation:** This interprets the scope of the Adjudicating Authority's powers under the

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**Application:** The ratio is applied to the specific facts of the case, where the Adjudicating

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## Parties

- **Judges:** S.J. Mukhop…; Bansi Lal…
- **Appellants:** Kannan Tiruvengand…
- **Respondents:** Assam Company…; M.K. Shah Exports…

## Timeline

- **2018-07-26 — Initiation…**: Corporate Insolvency Resolution Process was initiated under Section 7 of I&B Code against…
- **2018-04-26 — Impugned…**: Adjudicating Authority passed an impugned order referring to advertisement published on…

## 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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