# In the matter of Loocust Incorp Apparel Export Pvt. Ltd.

> NCLT judgment dated 2023-07-27. Citation: TCN-2023-NCLT-02317. The case involves an application filed under Section 12A of the Insolvency and Bankruptcy Code…

- **Court:** NCLT
- **Order date:** 27 Jul 2023
- **Citation:** TCN-2023-NCLT-02317
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/loocust-incorp-apparel-export-pvt-ltd-6b1e597e

## Summary

### Background

The case involves an application filed under Section 12A of the Insolvency and Bankruptcy Code (IBC), 2016, read with Regulation 30A of the IBBI Regulations, 2016, and Rule 11 of the NCLT Rules, 2016, seeking to withdraw the Corporate Insolvency Resolution Process (CIRP) that was initiated against the Corporate Debtor, Locust Incorp Apparel Export Pvt Ltd. The CIRP was initiated vide order dated 10.07.2023, and a paper publication was issued calling for claims from stakeholders on 13.07.2023. The Respondent/Operational Creditor and the suspended director, on behalf of the Corporate Debtor, entered into a settlement of the subject operational debt via a Memorandum of Compromise dated 18.07.2023.

## Facts

The Corporate Insolvency Resolution Process (CIRP) was initiated against Locust Incorp Apparel Export Pvt Ltd. An order was issued on 2023-07-10 to initiate the CIRP. A public announcement was made on 2023-07-13, inviting claims from stakeholders. The Respondent/Operational Creditor and the suspended director representing the Corporate Debtor entered into a Memorandum of Compromise on 2023-07-18 to settle the operational debt. The Operational Creditor then executed Form FA on 2023-07-21. The Applicant sought to withdraw the CIRP under Section 12A of the IBC, Regulation 30A of the IBBI Regulations, and Rule 11 of the NCLT Rules. The Operational Creditor has paid the fee of the RP and nothing is to be paid to the RP or the cost towards the CIRP. The Memorandum of

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## Issues and analysis

### Issue 1: Whether the application for withdrawal of the CIRP under Section 12A of the IBC, Regulation 30A of …

**Ratio:** Section 12A of the IBC and Regulation 30A of the IBBI Regulations allow for the

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**Reasoning:** The court considered the submissions made by both parties and the Memorandum of

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**Interpretation:** Section 12A of the IBC provides a mechanism for withdrawing a CIRP if the

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**Application:** In this case, the Operational Creditor and the Corporate Debtor reached a

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## Parties

- **Judges:** SANJIV…; SAMEER…
- **Appellants:** Himalaya Intertrad…
- **Respondents:** Locust Incorp…; Loocust Incorp…

## Timeline

- **2023-07-10 — CIRP Initiati…**: Order issued to initiate the Corporate Insolvency Resolution Process (CIRP) against…
- **2023-07-13 — Public Annou…**: Paper publication was given calling…

## 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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