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

> NCLT judgment dated 2023-07-27. Citation: TCN-2023-NCLT-02309. 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-02309
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/loocust-incorp-apparel-export-pvt-ltd-a36c3319

## 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) initiated against Locust Incorp Apparel Export Pvt Ltd. The CIRP was initiated based on an order dated 2023-07-10. Paper publication was given calling for claims from the stakeholders on 2023-07-13. The Respondent/Operational Creditor and the suspended director on behalf of the Corporate Debtor entered into a settlement of the subject operational debt vide Memorandum of Compromise dated 2023-07-18.

## Facts

The Corporate Insolvency Resolution Process (CIRP) was initiated against Locust Incorp Apparel Export Pvt Ltd based on an order dated 2023-07-10. Himalaya Intertrade Pvt Ltd is the applicant. Paper publication was issued on 2023-07-13, inviting claims from stakeholders. Subsequently, the Respondent/Operational Creditor and the suspended director, representing the Corporate Debtor, entered into a Memorandum of Compromise on 2023-07-18, settling the operational debt. The Operational Creditor then executed Form FA on 2023-07-21. The applicant then filed an application under Section 12A of the IBC, seeking to withdraw the CIRP. 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.

## Issues and analysis

### Issue 1: Whether the application for withdrawal of the Corporate Insolvency Resolution Process (CIRP) under …

**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, the Memorandum of Compromise entered between

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

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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 Init…**: CIRP was initiated against the Corporate…
- **2023-07-13 — Paper Publi…**: 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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