# In the matter of Shree Murugan Flour Mills Pvt. Ltd. IA(IB)-245-2020 in CP-636-IB-2019

> NCLT judgment dated 2020-02-28. Citation: TCN-2020-NCLT-01758. The case involves an application to withdraw a company petition (CP/636/IB/2019) after a…

- **Court:** NCLT
- **Order date:** 28 Feb 2020
- **Citation:** TCN-2020-NCLT-01758
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/shree-murugan-flour-mills-pvt-ltd-iaib-245-2020-in-cp-636-ib-2019-1b9afb1c

## Summary

### Background

The case involves an application to withdraw a company petition (CP/636/IB/2019) after a settlement was reached between the parties subsequent to the petition's admission and the initiation of the Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor. The settlement was formalized through a Memorandum of Compromise. The Interim Resolution Professional (IRP) was informed of the settlement before the withdrawal application was filed.

## Facts

A company petition (CP/636/IB/2019) was filed, and CIRP was initiated against a Corporate Debtor. Subsequently, the parties reached a settlement and entered into a Memorandum of Compromise. The IRP was informed of the settlement before the application for withdrawal was filed. The CoC was constituted, comprising Asset Recovery Management Branch, Indian Overseas Bank, and Indian Overseas Bank, Large Corporate Branch. The IRP submitted a report on the CoC's constitution. An email was produced to show communication between the parties and the IRP regarding the settlement. The Operational Creditor communicated to the IRP to proceed with the application under Section 12-A of IBC, 2016 for withdrawal. The report of the IRP regarding the constitution of the CoC was received

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## Issues and analysis

### Issue 1: Whether the application for withdrawal of the company petition can be allowed under Rule 11 of the …

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

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**Reasoning:** The Tribunal considered the settlement between the parties, the communication to the IRP,

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**Interpretation:** Rule 11 of the NCLT Rules, 2016, grants the Tribunal inherent powers to ensure

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**Application:** In this case, the Tribunal applied the ratio by considering the settlement

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## Parties

- **Judges:** R. VARADH…; Anil Ku…
- **Appellants:** G.BALASUBRAMANIAM…
- **Respondents:** MRS.RAJASHREE…
- **Advocates:** B.R.Shanker…; S.Manjula…

## Timeline

- **2020-02-22 — Memorandum of C…**: Parties entered into a…
- **2020-02-24 — IRP Report…**: The IRP filed a report regarding…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 12 — Time-limit for completion of insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-12)

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