# In the matter of Kundan Industries Ltd.

> NCLT judgment dated 2024-02-08. Citation: TCN-2024-NCLT-02701. The case involves an Interlocutory Application filed for the withdrawal of the Corporate…

- **Court:** NCLT
- **Order date:** 8 Feb 2024
- **Citation:** TCN-2024-NCLT-02701
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/kundan-industries-ltd-8f4050c2

## Summary

### Background

The case involves an Interlocutory Application filed for the withdrawal of the Corporate Insolvency Resolution Process (CIRP) against Kundan Industries Limited. The CIRP was initiated on 2024-01-02. The Operational Creditor and the Corporate Debtor reached a settlement agreement on 2024-01-17, where the Operational Creditor accepted Rs.2,50,00,000/- towards full settlement of its claim. A Committee of Creditors had not yet been constituted. The Operational Creditor provided Form FA on 2024-01-19 for withdrawal of the CIRP.

## Facts

The Corporate Insolvency Resolution Process (CIRP) was initiated against Kundan Industries Limited on 2024-01-02. The Operational Creditor and the Corporate Debtor entered into a settlement agreement on 2024-01-17, where the Operational Creditor agreed to accept Rs.2,50,00,000/- for full settlement of its claim. A Committee of Creditors had not been formed. The Operational Creditor submitted Form FA on 2024-01-19 for withdrawal of the CIRP. No CIRP costs were incurred. The Applicant confirmed that all expenses incurred during the CIRP had been settled. The Interlocutory Application was filed for withdrawal of the CIRP. The moratorium was declared under Section 14 of the Insolvency and Bankruptcy Code, 2016. The main Company Petition was CP (IB) No. 153 of 2023.

## Issues and analysis

### Issue 1: Whether the Interlocutory Application for withdrawal of the Corporate Insolvency Resolution Process …

**Ratio:** Section 12A of the Insolvency and Bankruptcy Code, 2016, read with Rule 11 of NCLT Rules,

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**Reasoning:** The court considered the submissions and averments made in the Interlocutory Application

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**Interpretation:** Section 12A provides a mechanism for withdrawal of CIRP if certain conditions

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**Application:** The court applied Section 12A, Rule 11, and Regulation 30A(1)(a) to the facts

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## Parties

- **Judges:** Prabhat…; V.G. B…
- **Appellants:** Aniruth Purusotham…
- **Respondents:** Kundan Industries…; Aditya N.…

## Timeline

- **2024-01-02 — CIRP Init…**: Corporate Insolvency Resolution Process…
- **2024-01-17 — Settlement Ag…**: Operational Creditor entered into Settlement Agreement with Ex-CFO of the Corporate…

## 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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