# In the matter of karismaa Foundations Private Limited MA-993-2019 in CP-769-IB-2018

> NCLT judgment dated 2019-09-16. Citation: TCN-2019-NCLT-01459. The Corporate Insolvency Resolution Process (CIRP) was initiated against the Corporate Debtor…

- **Court:** NCLT
- **Order date:** 16 Sept 2019
- **Citation:** TCN-2019-NCLT-01459
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/karismaa-foundations-private-limited-ma-993-2019-in-cp-769-ib-2018-6ef1093d

## Summary

### Background

The Corporate Insolvency Resolution Process (CIRP) was initiated against the Corporate Debtor on July 1, 2019. A public announcement was made, and the Committee of Creditors (CoC) was constituted. Efforts were made between the parties for settlement, but the timeline for issuing an invitation did not reach fruition. Agreements were signed between the Applicant/Financial Creditor, Mrs. G. Sree Vidhya, and the Corporate Debtor on September 14, 2019. Similarly, an agreement to settle the financial debt was entered into between M/s. Narendra Properties Limited and the Corporate Debtor on September 16, 2019.

## Facts

The CIRP was initiated against the Corporate Debtor on 01.07.2019. A public announcement was made, and the CoC was constituted. Agreements were signed between Mrs. G. Sree Vidhya (Applicant/Financial Creditor) and the Corporate Debtor on 14.09.2019, and between M/s. Narendra Properties Limited and the Corporate Debtor on 16.09.2019, to settle the financial debt. The 2nd CoC meeting was convened on 14.09.2019, where a resolution was passed to withdraw the CIRP. Mrs. G. Sree Vidhya prayed to withdraw the original CP based on these agreements. An upfront payment was made to Mrs. G. Sree Vidhya and the representative of M/s. Narendra Properties Limited. Rs.55 lakhs to Mrs. G. Sree Vidhya and Rs.50 lakhs to M/s. Narendra Properties Limited are to be paid at the time of

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## Issues and analysis

### Issue 1: Whether the withdrawal of the CIRP initiated against the Corporate Debtor is justified based on the …

**Ratio:** The principle of allowing withdrawal of CIRP upon settlement between the parties is based

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**Reasoning:** The court reasoned that the parties had entered into settlement agreements, and a

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**Interpretation:** This interpretation allows for the withdrawal of CIRP when all parties involved

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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:** Ch. Mohd Sharief…; SHRI. ANIL…
- **Appellants:** S Aneetha…
- **Respondents:** Karismaa Foundatio…
- **Advocates:** Anant Mer…; Poornima De…; +5 more

## Timeline

- **2019-07-01 — CIRP Init…**: Corporate Insolvency Resolution Process (CIRP)…
- **2019-09-14 — Agreement…**: Agreement signed between Mrs. G. Sree…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 12A — (1) Subject to sub](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-12a)

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