# In the matter of KSM Spinning Mills Limited IA Nos. 249,659,
667,707,265,266,462,466,817 & 816 of 2020 In CP (IB) No. 250-Chd-Pb-2018

> NCLT judgment dated 2021-07-27. Citation: TCN-2021-NCLT-01597. The document pertains to several Interlocutory Applications (IAs) filed in connection with the…

- **Court:** NCLT
- **Order date:** 27 Jul 2021
- **Citation:** TCN-2021-NCLT-01597
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/ksm-spinning-mills-limited-ia-nos-249659-667707265266462466817-816-of-2020-in-cp-6be4288f

## Summary

### Background

The document pertains to several Interlocutory Applications (IAs) filed in connection with the Corporate Insolvency Resolution Process (CIRP) of KSM Spinning Mills Limited. The CIRP was initiated following the admission of a petition filed by Central Bank of India. The IAs address issues such as the admission of claims by operational creditors, the eligibility and conduct of the Resolution Professional (RP), and challenges to the resolution plan.

## Facts

The Corporate Insolvency Resolution Process (CIRP) was initiated against KSM Spinning Mills Limited on 2019-12-17, based on a petition filed by Central Bank of India. Several operational creditors, including Nilkanth Cotton Fibers, Anjani Cotton Industries, and Tirupati Cotton, filed claims after the initial deadline. Nilkanth Cotton Fibers' claim was initially rejected as time-barred, but they had obtained a decree against the corporate debtor. Anjani Cotton Industries sought interest on their claim, citing the MSME Act. Sarish Mittal, a suspended director, filed multiple IAs alleging misconduct by the Resolution Professional (RP), Nipan Bansal, and his counsel, Harsh Garg. He also challenged Nipan Bansal's appointment and sought his removal. The Committee of

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## Issues and analysis

### Issue 1: Whether the claim of Nilkanth Cotton Fibers should be admitted despite being filed after the …

**Ratio:** The fixation of a time limit for the submission of claims is directory, not mandatory. A

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**Reasoning:** The court reasoned that since Nilkanth Cotton Fibers had obtained a decree against the

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**Interpretation:** The interpretation emphasizes that while deadlines exist for claim submissions,

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**Application:** The ratio and reasoning were applied to the facts of IA No. 249/2020, leading

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## Parties

- **Judges:** Ajay Kumar…; RAGHU N…; +1 more
- **Appellants:** Central Bank of…
- **Respondents:** KSM Spinning…

## Timeline

- **2019-12-17 — CIRP Init…**: Corporate Insolvency Resolution Process (CIRP) initiated against KSM Spinning Mills…
- **2018-01-01 — CP (IB) No. 250/Chd/Pb/2…**: CP (IB) No. 250/Chd/Pb/2018 filed by…

## 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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