# In the matter of Sonachi Industries Ltd. MA 1419-2018 & 719-2019 in CP(IB)1479(MB)-2017

> NCLT judgment dated 2019-02-28. Citation: TCN-2019-NCLT-04651. The case involves an application filed by the Resolution Professional (RP) under Section 60(5)…

- **Court:** NCLT
- **Order date:** 28 Feb 2019
- **Citation:** TCN-2019-NCLT-04651
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/sonachi-industries-ltd-ma-1419-2018-719-2019-in-cpib1479mb-2017-59853750

## Summary

### Background

The case involves an application filed by the Resolution Professional (RP) under Section 60(5) of the IBC, 2016, seeking exclusion of 68 days from the CIRP period. The CIRP was initiated based on a petition by an Operational Creditor, which was admitted on 2.5.2018. The RP was appointed initially as the Interim Resolution Professional and later as the Resolution Professional. During the CIRP, discrepancies in the stock were noticed, and the RP brought these to the attention of the Committee of Creditors (CoC). The RP also filed an application under Section 66 of the IBC, 2016, regarding fraudulent trading by the Corporate Debtor. The CoC was considering the eligibility of the sole resolution applicant, and the RP sought a decision from the Tribunal on this matter.

## Facts

The Corporate Insolvency Resolution Process (CIRP) was initiated against Sonachi Industries Ltd based on a petition filed by an Operational Creditor, which was admitted on 2.5.2018. Mr. Syamal Baran Bhattacharya was appointed as the Resolution Professional (RP). During the CIRP, the RP discovered discrepancies in the debtor's stock and brought them to the attention of the Committee of Creditors (CoC). The RP also filed an application under Section 66 of the IBC, 2016, alleging fraudulent trading by the Corporate Debtor. The CIRP period of 270 days expired on 27.1.2019, without a resolution plan being approved. The RP then filed an application (MA 719/2019) seeking exclusion of 68 days from the CIRP period, from 20.11.2018 to 27.1.2019. The CoC was considering the

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## Issues and analysis

### Issue 1: Whether the Resolution Professional (RP) was justified in seeking exclusion of 68 days from the …

**Ratio:** The statutory period provided under the Code cannot be extended by any authority. The

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**Reasoning:** The Tribunal reasoned that the application for exclusion of 68 days was filed after about

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**Interpretation:** The interpretation of the law is that the CIRP period is strictly governed by

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**Application:** The Tribunal applied the ratio to the facts by noting that the application for

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## Parties

- **Judges:** V. P. S…; Ravikumar…; +1 more
- **Appellants:** Syamal Baran…
- **Respondents:** Sonachi Industries…; Sonachi Industries…

## Timeline

- **2018-05-02 — Admission of Petition…**: Petition under Section 9 of…
- **2018-11-20 — Start of Exclusion…**: The Resolution Professional sought…

## 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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