# In the matter of Sovika Aviation Services Pvt. Ltd. IA-2308-2020 & IA-256,444 & 805-2021 in CP(IB)-4663(MB)-2018

> NCLT judgment dated 2021-09-23. Citation: TCN-2021-NCLT-01035. The case involves multiple Interlocutory Applications (IAs) filed in connection with a…

- **Court:** NCLT
- **Order date:** 23 Sept 2021
- **Citation:** TCN-2021-NCLT-01035
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/sovika-aviation-services-pvt-ltd-ia-2308-2020-ia-256444-805-2021-in-cpib-4663mb-a22684f8

## Summary

### Background

The case involves multiple Interlocutory Applications (IAs) filed in connection with a Corporate Insolvency Resolution Process (CIRP) initiated under Section 9 of the Insolvency and Bankruptcy Code, 2016. The Resolution Professional (RP) filed IA-256/2021 seeking exclusion and extension of time due to the lockdown imposed by the State of Maharashtra. Other IAs (IA-2308/2020 and IA-444/2021) were filed by the RP seeking admission of claims from Operational Creditors. IA-805/2021 was filed by the RP seeking withdrawal of the CIRP based on a resolution passed by the Committee of Creditors (CoC). The CoC, consisting solely of Union Bank of India, approved the withdrawal after a settlement agreement was reached with the Corporate Debtor.

## Facts

Aviaxpert Pvt. Ltd. was undergoing a Corporate Insolvency Resolution Process (CIRP) under Section 9 of the Insolvency and Bankruptcy Code, 2016. The Resolution Professional (RP) filed several applications, including one for exclusion of time due to the COVID-19 lockdown (IA-256/2021). The RP also filed applications for the admission of claims from Operational Creditors (IA-2308/2020 and IA-444/2021). The Committee of Creditors (CoC), consisting solely of Union Bank of India, resolved to withdraw the CIRP (IA-805/2021) after a settlement agreement was reached with the Corporate Debtor, involving a payment of Rs. 64 crores. The sole CoC member also ratified the CIRP costs and ensured their payment. The Corporate Debtor entered into an OTS (One Time Settlement) agreement

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## Issues and analysis

### Issue 1: Whether the Resolution Professional's application for exclusion of time (IA-256/2021) due to the …

**Ratio:** The court has the power to exclude periods affected by lockdowns or other extraordinary

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**Reasoning:** The State of Maharashtra imposed a lockdown, which disrupted normal business operations

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**Interpretation:** The provision for excluding time is interpreted to accommodate unforeseen

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**Application:** The court allowed the exclusion of 138 days (from 16.07.2020 to 30.11.2020)

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## Parties

- **Judges:** RAJESH S…; SUCHITRA KANUPARTH…; +1 more
- **Respondents:** Aviaxpert Pvt.…; Sovika Aviation…

## Timeline

- **2020-07-16 — Start of Exclusion…**: Start date for the exclusion of 138 days…
- **2020-11-30 — End of Exclusi…**: End date for the exclusion of 138 days…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 12A — (1) Subject to sub](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-12a)

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