# In the matter of VS Lignite Power Pvt. Ltd. IA No. 602-2020 in CP (IB) No. 563-9-HDB-2019

> NCLT judgment dated 2020-08-21. Citation: TCN-2020-NCLT-00804. The case pertains to an application filed under Section 12(2) & (3) of the IB Code, 2016, read…

- **Court:** NCLT
- **Order date:** 21 Aug 2020
- **Citation:** TCN-2020-NCLT-00804
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/vs-lignite-power-pvt-ltd-ia-no-602-2020-in-cp-ib-no-563-9-hdb-2019-ac648ade

## Summary

### Background

The case pertains to an application filed under Section 12(2) & (3) of the IB Code, 2016, read with Regulation 40 of the IBBI (IRPCP) Regulations, 2016, seeking an extension of the Corporate Insolvency Resolution Process (CIRP) period. The Tribunal had admitted the Company Petition on 18.09.2019 and appointed an Interim Resolution Professional (IRP), who was later confirmed as the Resolution Professional. The initial CIRP period of 180 days was expiring on 16.03.2020. An extension of 90 days was granted until 14.06.2020. However, due to the Covid-19 lockdown, resolution plans were received late, and the applicant sought a further extension.

## Facts

The Tribunal admitted a company petition on 2019-09-18 and appointed an Interim Resolution Professional (IRP), who was confirmed as the Resolution Professional on 2019-10-18. The initial CIRP period of 180 days was expiring on 2020-03-16. An extension of 90 days was granted until 2020-06-14. Due to the Covid-19 lockdown from 2020-03-25 to 2020-06-07, resolution plans were received late on 2020-07-08. The Resolution Professional sought a further extension of 60 days, effective from 2020-08-28. The CoC resolved to seek this extension on 2020-08-03. The application was filed under Section 12(3) of the Insolvency & Bankruptcy Code, 2016. The Resolution Professional relied on the proviso to section 12(3) of the I&B Code, which mandates the completion of CIRP within

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## Issues and analysis

### Issue 1: Whether the Resolution Professional is entitled to an extension of the CIRP period beyond the …

**Ratio:** Section 12 of the IBC, 2016, allows for extensions of the CIRP period, subject to certain

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**Reasoning:** The Tribunal considered the practical difficulties caused by the Covid-19 lockdown, which

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**Interpretation:** Section 12 of the IBC is interpreted to allow for extensions of the CIRP period

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**Application:** In this case, the Tribunal found that the Resolution Professional was entitled

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## Parties

- **Judges:** Ratakonda…; Veera Brahma Rao…
- **Appellants:** Refex Industries…
- **Respondents:** VS Lignite Power…

## Timeline

- **2019-09-18 — Admission of Company…**: The Tribunal admitted the Company Petition and appointed the applicant as Interim…
- **2019-10-18 — Confirmation of…**: The IRP was confirmed as Resolution…

## 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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