# In the matter of Barbrik Projects Limited IA No. 195-CTB-2019 in CP (IB) No. 87-CTB-2019

> NCLT judgment dated 2019-12-20. Citation: TCN-2019-NCLT-00026. The case involves an application (IA No. 195/CTB/2019) filed by the Operational Creditor…

- **Court:** NCLT
- **Order date:** 20 Dec 2019
- **Citation:** TCN-2019-NCLT-00026
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/barbrik-projects-limited-ia-no-195-ctb-2019-in-cp-ib-no-87-ctb-2019-ebb4a756

## Summary

### Background

The case involves an application (IA No. 195/CTB/2019) filed by the Operational Creditor seeking termination of the Corporate Insolvency Resolution Process (CIRP) that was initiated on 2019-12-16. Both parties, the Operational Creditor and the Corporate Debtor, settled their claims under a deed of settlement dated 2019-12-17. The Operational Creditor had received the entire amount as per the settlement agreement and sought permission from the Adjudicating Authority to withdraw the application.

## Facts

Veer Wires Pvt. Ltd. initiated a Corporate Insolvency Resolution Process (CIRP) against Barbik Project Ltd. CP No. 87/CTB/2019 was filed, and IA No. 195/CTB/2019 was filed by the Operational Creditor to terminate the CIRP. The CIRP was initiated on 2019-12-16. The Operational Creditor and Corporate Debtor entered into a settlement agreement dated 2019-12-17, where the Corporate Debtor paid the Operational Creditor the entire amount due. The Committee of Creditors (COC) was not constituted. The IRP was present before the Adjudicating Authority. The Operational Creditor sought to withdraw the application for CIRP. The Adjudicating Authority considered the settlement and the fact that the COC was not constituted.

## Issues and analysis

### Issue 1: Whether the CIR process can be terminated prior to the constitution of the COC on a compromise …

**Ratio:** The CIR process can be terminated prior to the constitution of the COC if a compromise is

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**Reasoning:** The court reasoned that since the parties had reached a settlement and the Operational

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**Interpretation:** This interprets the Insolvency and Bankruptcy Code (IBC) to allow for the

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**Application:** In this case, the parties reached a settlement, and the Operational Creditor

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## Parties

- **Judges:** Sucharit…; Satya Ranjan…
- **Appellants:** Veer Wires Pvt.…
- **Respondents:** Barbik Project…

## Timeline

- **2019-12-16 — CIRP Init…**: The Corporate Insolvency…
- **2019-12-17 — Settlement Ag…**: The Operational Creditor and Corporate…

## 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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