# In the matter of Metro Builders Orrisa Pvt. Ltd. IA No. 179-CTB-2019 in CP (IB) No. CTB-2019

> NCLT judgment dated 2019-12-11. Citation: TCN-2019-NCLT-00230. IA No. 179/CTB/2019 was filed by the Operational Creditor seeking termination of the CIRP,…

- **Court:** NCLT
- **Order date:** 11 Dec 2019
- **Citation:** TCN-2019-NCLT-00230
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/metro-builders-orrisa-pvt-ltd-ia-no-179-ctb-2019-in-cp-ib-no-ctb-2019-a4c5c228

## Summary

### Background

IA No. 179/CTB/2019 was filed by the Operational Creditor seeking termination of the CIRP, which had commenced on 2019-12-02. The Operational Creditor and Corporate Debtor reached a settlement under a Memorandum of Settlement. The Operational Creditor had received a portion of the settlement amount and sought permission to withdraw the application. The IRP appointed by the Adjudicating Authority was not present, and it was submitted that no COC had been constituted. Reliance was placed on the decision of the Hon'ble Apex Court in 'Swiss Ribbons Pvt. Ltd. & Anr. Vs. Union of India & Ors.', W.P.(C) 99/2018.

## Facts

The Operational Creditor, M/s Vikas Scaffolding Systems, initiated CIRP against the Corporate Debtor, Metro Builders Orissa Pvt. Ltd. The CIRP was initiated on 2019-12-02. Subsequently, the parties reached a settlement under a Memorandum of Settlement. The Operational Creditor received a portion of the settlement amount. The IRP appointed by the Adjudicating Authority was not present, and no COC had been constituted. The Operational Creditor then filed IA No. 179/CTB/2019 seeking termination of the CIRP. The Adjudicating Authority considered the settlement and the absence of a COC before allowing the withdrawal of the application and terminating the CIRP. The case references CP (IB) No. 103/CTB/2019 and IA No. 179/CTB/2019.

## Issues and analysis

### Issue 1: Whether the Adjudicating Authority can allow the withdrawal of an application for initiating CIRP …

**Ratio:** The legal principle applied is that CIRP can be terminated prior to the constitution of

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**Reasoning:** The court reasoned that since the parties had reached a settlement and no COC had been

…

**Interpretation:** The interpretation is that the IBC allows for flexibility in resolving

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**Application:** In this case, the Operational Creditor and Corporate Debtor reached a

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## Parties

- **Judges:** Sucharit…; Satya Ranjan…
- **Respondents:** Metro Builders…; Rakesh Kumar…

## Timeline

- **2019-12-02 — CIRP Init…**: CIRP was initiated against…
- **2019-12-11 — Hearing…**: Hearing held on IA No.…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 9 — Application for initiation of corporate insolvency…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-9)

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