# In the matter of Mr. Rakesh Kumar Agarwal and Ors. Vs. Mr. Devendra P. Jain CA (AT) (Ins) No. 1034 of 2020

> NCLAT judgment dated 2021-06-01. Citation: TCN-2021-NCLAT-00254. The appeal was filed challenging the order dated 15.10.2020 passed by the Adjudicating…

- **Court:** NCLAT
- **Order date:** 1 Jun 2021
- **Citation:** TCN-2021-NCLAT-00254
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/mr-rakesh-kumar-agarwal-and-ors-vs-mr-devendra-p-jain-ca-a4cd5cf9

## Summary

### Background

The appeal was filed challenging the order dated 15.10.2020 passed by the Adjudicating Authority (NCLT Ahmedabad) Ahmedabad Bench Court No. -II, which rejected I.A No. 496 of 2020 filed by the Appellants. The corporate debtor had filed an application under Section 10 of the Insolvency and Bankruptcy Code (IBC), which was admitted by the Adjudicating Authority on 11.01.2018. Subsequently, the IRP was appointed, and an Expression of Interest (EOI) was issued on 15.02.2018. A resolution was passed for the liquidation of the Corporate Debtor on 26.10.2018. The RP filed I.A No. 461 of 2018 for liquidation, and the Adjudicating Authority passed an order for liquidation on 28.08.2019. The appellant submitted a scheme under Section 230 of the Companies Act, 2013, which was

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## Facts

The Corporate Debtor's application under Section 10 of the IBC was admitted on 11.01.2018. An IRP was appointed, and an EOI was issued on 15.02.2018. No resolution plan was received. A resolution for liquidation was passed on 26.10.2018, and the liquidation order was passed on 28.08.2019. The Appellant submitted a scheme under Section 230 of the Companies Act, 2013, which was approved by stakeholders. However, I.A No. 66 of 2020 was dismissed due to a notification dated 06.01.2020 amending Regulation 2B of the IBBI Regulations, making the Appellants ineligible to submit a scheme. The Appellants then filed I.A No. 496 of 2020, seeking permission to propose a scheme, arguing that a subsequent notification dated 01.06.2020, revising MSME limits, made the Corporate Debtor

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## Issues and analysis

### Issue 1: Whether the Appellants are eligible to submit a scheme of arrangement under Section 230 of the …

**Ratio:** The ratio is that liquidation is the last resort, and revival of the corporate debtor

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**Reasoning:** The tribunal reasoned that the Hon'ble Supreme Court has consistently held that

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**Interpretation:** The interpretation is that the IBC aims to revive corporate debtors whenever

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**Application:** The tribunal applied the ratio and reasoning to the specific facts of the case,

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## Parties

- **Judges:** Jarat Kuma…; Kanthi Na…; +1 more
- **Appellants:** Rakesh Kumar…
- **Respondents:** Asis Industries…; Devendra P…

## Timeline

- **2018-01-11 — Admission of Section 10…**: The Corporate Debtor's application under…
- **2018-02-15 — Issuance…**: The IRP issued an Expression of Interest…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 230 — Delegation](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-230)

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