# In the matter of Promozone (India) Pvt. Ltd. I.A. 2176-2022 in C.P.(IB)-3802(MB)-2019

> NCLT judgment dated 2022-08-23. Citation: TCN-2022-NCLT-01310. The case involves an application (I.A. 2176/2022) filed by the Interim Resolution Professional…

- **Court:** NCLT
- **Order date:** 23 Aug 2022
- **Citation:** TCN-2022-NCLT-01310
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/promozone-india-pvt-ltd-ia-2176-2022-in-cpib-3802mb-2019-2b73306b

## Summary

### Background

The case involves an application (I.A. 2176/2022) filed by the Interim Resolution Professional (IRP) under Section 12A of the Insolvency and Bankruptcy Code for the withdrawal of the Corporate Insolvency Resolution Process (CIRP) order. The CIRP order was initially passed against the Corporate Debtor on 12.05.2022. The matter was settled between the parties through a settlement agreement dated 29.06.2022, executed on 30.06.2022, before the constitution of the Committee of Creditors (COC) by the IRP.

## Facts

The Corporate Debtor, Mirah Dekor Pvt Ltd, was subject to a CIRP order dated 12.05.2022. The Interim Resolution Professional (IRP) filed an application (I.A. 2176/2022) under Section 12A of the Insolvency and Bankruptcy Code to withdraw the CIRP order. A settlement agreement was reached between Mirah Dekor Pvt Ltd and Promozone India Pvt Ltd on 29.06.2022, executed on 30.06.2022, before the constitution of the Committee of Creditors (COC). As per the settlement, the Corporate Debtor agreed to pay Rs. 40,00,000/- as full and final settlement. The IRP confirmed receipt of CIRP costs, including his fee. The key fact is that the settlement was reached before the COC was formed, thus negating the requirement for COC approval.

## Issues and analysis

### Issue 1: Whether the application for withdrawal of the CIRP order should be allowed based on the settlement …

**Ratio:** Section 12A of the Insolvency and Bankruptcy Code allows for the withdrawal of CIRP under

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**Reasoning:** The court reasoned that since the settlement agreement was reached before the COC was

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**Interpretation:** Section 12A provides a mechanism for parties to settle disputes and withdraw

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**Application:** In this case, the settlement agreement between the Corporate Debtor and the

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## Parties

- **Judges:** H.V. Subb…; SMT ANURADHA…
- **Respondents:** Mirah Dekor Pvt…; Promozone India…

## Timeline

- **2022-05-12 — CIRP Ord…**: CIRP order passed…
- **2022-06-29 — Settlement Ag…**: Settlement agreement dated 29.06.2022…

## 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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