# In the matter of Lifeline Infotech Private Limited CA-2115 (PB)-2019 in (IB)-1724(PB)-2018

> NCLT judgment dated 2019-10-16. Citation: TCN-2019-NCLT-00972. The case involves an application filed by the Interim Resolution Professional (IRP) to withdraw…

- **Court:** NCLT
- **Order date:** 16 Oct 2019
- **Citation:** TCN-2019-NCLT-00972
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/lifeline-infotech-private-limited-ca-2115-pb-2019-in-ib-1724pb-2018-a32e4640

## Summary

### Background

The case involves an application filed by the Interim Resolution Professional (IRP) to withdraw a Company Petition No. (IB)-1724 (PB)/2019 under Regulation 30-A of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. The application was filed due to a settlement between the management of the Corporate Debtor and the Financial Creditor before the constitution of the Committee of Creditors (CoC). The financial creditor, M/s Khanna Jewellers Private Limited, had initially filed an application under Section 7 of the Code, which was admitted against the corporate debtor, M/s Lifetime Infotech Private Limited. The IRP was appointed following the admission order dated 25.09.2019. Subsequently, the financial

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## Facts

M/s Khanna Jewellers Private Limited, the financial creditor, initiated a Corporate Insolvency Resolution Process (CIRP) against M/s Lifetime Infotech Private Limited, the corporate debtor, by filing an application under Section 7 of the Insolvency and Bankruptcy Code (IBC). The application was admitted, and an Interim Resolution Professional (IRP) was appointed on 2019-09-25. Subsequently, before the constitution of the Committee of Creditors (CoC), the financial creditor and the corporate debtor entered into a share purchase agreement and executed a Memorandum of Understanding (MOU) on 2019-09-23, settling the claim. The financial creditor then filed an application in Form-FA under regulation 30 A (2) for withdrawal of the CIRP, attaching a bank guarantee. The IRP

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## Issues and analysis

### Issue 1: Whether the NCLT can allow the withdrawal of a Corporate Insolvency Resolution Process (CIRP) …

**Ratio:** The NCLT has inherent powers under Rule 11 of the NCLT Rules, 2016, to allow or disallow

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**Reasoning:** The court reasoned that while a CIRP is a collective proceeding in rem once triggered,

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**Interpretation:** The interpretation of Rule 11 of the NCLT Rules, 2016, allows the NCLT to

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**Application:** In this case, the financial creditor and the corporate debtor reached a

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## Parties

- **Judges:** DEEPTI M…; S. K. MOH…
- **Appellants:** M/s Khanna…
- **Respondents:** M/s Lifetime…
- **Advocates:** Akshay Ma…; Saak…; +6 more

## Timeline

- **2019-09-23 — Share Purchase…**: The petitioner financial creditor and the corporate debtor entered into a share purchase…
- **2019-09-25 — Admission…**: The application under Section 7 of the Code filed by the financial creditor was admitted…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

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