# In the matter of SICOM Ltd. & Ors. vs. Kitply Industries Ltd. COMPANY APPEAL (AT)(Insolvency) No.849-2021

> NCLAT judgment dated 2023-04-10. Citation: TCN-2023-NCLAT-00634. This case involves an appeal against an order dated 31.08.2021 passed by the National Company…

- **Court:** NCLAT
- **Order date:** 10 Apr 2023
- **Citation:** TCN-2023-NCLAT-00634
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/sicom-ltd-ors-vs-kitply-industries-ltd-company-appeal-eb31ff88

## Summary

### Background

This case involves an appeal against an order dated 31.08.2021 passed by the National Company Law Tribunal (NCLT), Guwahati Bench, which allowed an application filed by Kitply Industries Ltd, the Corporate Debtor (CD). The application pertained to the transfer of the Igatpuri Unit to the nominee of the Resolution Applicant (RA), Kitply Industries Ltd. The appellant, SICOM Ltd, was directed to transfer the Igatpuri Unit within 45 days. The dispute originates from an agreement to sell dated 03.09.1998 between SICOM Ltd and Kitply Industries Ltd for the Igatpuri Unit. A financial assistance was also provided by SICOM to Kitply Industries. The CD faced financial hardships and proposed a one-time settlement (OTS), which was accepted but later allegedly defaulted upon,

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## Facts

In 1998, SICOM Ltd (Appellant) and Kitply Industries Ltd (Corporate Debtor/Respondent) entered into an agreement for the sale of a property (Igatpuri Unit) for Rs.2,25,00,000. Kitply paid an initial amount of Rs.10,00,000 as earnest money and Rs.56,25,000. The possession of the Igatpuri Unit was given to Kitply. The remaining amount was to be paid in installments. Kitply also availed a financial assistance of Rs.8.90 Crores from SICOM in the form of Inter Corporate Deposit (ICD). Due to financial difficulties, Kitply could not pay some installments. Later, Kitply proposed a one-time settlement (OTS) for the dues under the ICD and the balance outstanding under the DPF, which SICOM accepted. Kitply paid Rs.200,00,000 in cash and issued Non-Convertible Debentures (NCDs)

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## Issues and analysis

### Issue 1: Whether the NCLT had the jurisdiction to direct SICOM Ltd to transfer the Igatpuri Unit to Kitply …

**Ratio:** The NCLT's jurisdiction under Section 60(5) of the IBC is limited to matters related to

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**Reasoning:** The appellate tribunal reasoned that the dispute over the agreement to sell and the OTS

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**Interpretation:** Section 60(5) of the IBC does not grant the NCLT the power to adjudicate all

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**Application:** In this case, the dispute over the transfer of the Igatpuri Unit was a

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## Parties

- **Judges:** Rakesh…; Alok Sriv…
- **Appellants:** SICOM…
- **Respondents:** Kitply Industries…

## Timeline

- **1998-09-03 — Agreement t…**: SICOM Ltd and Kitply Industries Ltd entered into an agreement for the sale of Igatpuri…
- **1999-05-07 — Financial Ass…**: SICOM provided financial assistance of Rs.8.90 Crores to Kitply in the form of Inter…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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