# In the matter of Kuldeep Verma vs. Government of Kerala & Ors.

> NCLAT judgment dated 2024-10-28. Citation: TCN-2024-NCLAT-00137. This is an appeal filed against the order dated 31.07.2024 passed by the National Company Law…

- **Court:** NCLAT
- **Order date:** 28 Oct 2024
- **Citation:** TCN-2024-NCLAT-00137
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/kuldeep-verma-vs-government-of-kerala-ors-e1b81249

## Summary

### Background

This is an appeal filed against the order dated 31.07.2024 passed by the National Company Law Tribunal (NCLT), New Delhi Bench (Court-II) in CA 1297/2020. The appeal was filed by the liquidator of the Corporate Debtor. The core issue revolves around the proposed sale of shares of a subsidiary company, M/s Hindustan Newsprint Ltd., which was initially approved by the Adjudicating Authority on 25.11.2019.

## Facts

The liquidator of a Corporate Debtor filed an appeal against an order passed by the National Company Law Tribunal (NCLT), New Delhi. The NCLT order pertained to an application (IA 1297/2020) seeking direction to the Government of Kerala to purchase shares of M/s Hindustan Newsprint Ltd., a subsidiary company. The Adjudicating Authority had approved the sale of these shares on 25.11.2019. The Government of Kerala had initially offered to purchase the shares for Rs. 25 Cr, payable in 3 months. However, the Government of Kerala subsequently backed out of the purchase. The Corporate Insolvency Resolution Process (CIRP) was initiated for Hindustan Newsprint Ltd. on 28.11.2019, after the initial approval by the NCLT, which led to the State of Kerala's decision to withdraw

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority committed any error in rejecting the IA filed by the liquidator …

**Ratio:** A court cannot compel a party to complete a transaction if they have backed out, even if

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**Reasoning:** The tribunal reasoned that while backing out of a transaction may have legal

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**Interpretation:** This legal issue concerns the extent to which a court can enforce a commercial

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**Application:** In this specific case, the tribunal applied the principle that it could not

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## Parties

- **Judges:** Ashok Bh…; Barun M…
- **Appellants:** Kuldeep…
- **Respondents:** Hindustan…; Government of…
- **Advocates:** Vivek S…; Rahul S…; +2 more

## Timeline

- **2019-11-25 — Approval by Adjudicating…**: The Adjudicating Authority approved the sale…
- **2019-11-28 — CIRP Init…**: Corporate Insolvency Resolution Process…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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