# In the matter of Rajan Gupta. Vs. Ashok Kumar Sharma & Anr. CA(AT)(Insolvency) No. 572-2019

> NCLAT judgment dated 2019-05-30. Citation: TCN-2019-NCLAT-00523. Rajan Gupta, Director/Shareholder of Bhola Baba EXIM Pvt. Ltd., filed an appeal against the…

- **Court:** NCLAT
- **Order date:** 30 May 2019
- **Citation:** TCN-2019-NCLAT-00523
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/rajan-gupta-vs-ashok-kumar-sharma-anr-ca-6a98222e

## Summary

### Background

Rajan Gupta, Director/Shareholder of Bhola Baba EXIM Pvt. Ltd., filed an appeal against the order dated 16th May, 2019, passed by the Adjudicating Authority (National Company Law Tribunal), New Delhi Bench, which admitted an application under Section 9 of the Insolvency and Bankruptcy Code, 2016 (I&B Code) filed by Ashok Kumar Sharma, Proprietor, Alloysmin Industries. The appeal was filed before the National Company Law Appellate Tribunal (NCLAT).

## Facts

Rajan Gupta, representing Bhola Baba EXIM Pvt. Ltd., appealed against an order admitting an insolvency application filed by Ashok Kumar Sharma of Alloysmin Industries under Section 9 of the Insolvency and Bankruptcy Code. During the appeal process, the parties reached a settlement on May 22, 2019. A draft settlement of Rs. 13,22,927/- was presented. The Committee of Creditors had not yet been formed. The Interim Resolution Professional had already performed duties for more than 10 days, incurring costs of Rs. 12,000/-. A draft from Punjab National Bank for Rs. 13,22,927/- was issued to Alloysmin Industries. The NCLAT assessed the fee and cost of the Interim Resolution Professional at Rs. 1,22,000/-. The key fact is the settlement between the parties, which led to the

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## Issues and analysis

### Issue 1: Whether the appeal against the order admitting the insolvency application should be allowed given …

**Ratio:** The principle of allowing parties to settle disputes amicably and the court's role in

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**Reasoning:** The court considered the fact that the parties had reached a settlement and that the

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**Interpretation:** The interpretation is that settlements are favored, especially before

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

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## Parties

- **Judges:** S.J. Mukhop…; A.I.S. C…; +1 more
- **Appellants:** Rajan G…
- **Respondents:** Bhola Baba EXIM…; Ashok Kumar…

## Timeline

- **2019-05-16 — Order by Adjudicating…**: The Adjudicating Authority (National Company Law Tribunal), New Delhi Bench, passed an…
- **2019-05-22 — Settlement…**: The parties reached a settlement on 22nd May, 2019, and enclosed the Settlement Agreement…

## 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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