# In the matter of Saalim Shoes Pvt. Ltd. IA-814(CHE)-2021 in IBA-1104-2019

> NCLT judgment dated 2022-06-17. Citation: TCN-2022-NCLT-02201. The case involves an application (IA/814(CHE)/2021) filed under Section 19(2) of the IBC,…

- **Court:** NCLT
- **Order date:** 17 Jun 2022
- **Citation:** TCN-2022-NCLT-02201
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/saalim-shoes-pvt-ltd-ia-814che-2021-in-iba-1104-2019-b2837946

## Summary

### Background

The case involves an application (IA/814(CHE)/2021) filed under Section 19(2) of the IBC, seeking cooperation and submission of documents by the former board of directors of the Corporate Debtor under the Corporate Insolvency Resolution Process (CIRP). The Resolution Professional (RP) argues that the Corporate Debtor is an MSME and should be permitted to submit a resolution plan under Section 240A. A memo dated 28.02.2022 was submitted seeking withdrawal of IBA/1104/2019, after the resolution plan submitted by the Corporate Debtor/Resolution Applicant was approved by the Committee of Creditors (CoC).

## Facts

The application IA/814(CHE)/2021 was filed under Section 19(2) of the IBC, seeking cooperation and submission of documents from the former board of directors of the Corporate Debtor, which is undergoing CIRP. The RP argues that the Corporate Debtor is an MSME and should be allowed to submit a resolution plan under Section 240A. The resolution plan submitted by the Corporate Debtor/Resolution Applicant has been approved by the CoC. A memo dated 28.02.2022 was submitted seeking withdrawal of IBA/1104/2019. The Corporate Debtor's compliance with the provisions of the Code is questioned.

## Issues and analysis

### Issue 1: Whether the Corporate Debtor, being an MSME, can be permitted to participate as a resolution …

**Ratio:** Section 240A of the IBC provides certain relaxations and modifications for MSMEs

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**Reasoning:** The court questions whether allowing the Corporate Debtor to participate as a resolution

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**Interpretation:** The interpretation of Section 240A is crucial in determining whether MSMEs

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**Application:** The court applies the principle by questioning whether the Corporate Debtor's

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## Parties

- **Judges:** R. Sucha…; SAMEER…
- **Appellants:** S R Shriraam…
- **Respondents:** Saalim Shoes Pvt…; A Saalim Mo…

## Timeline

- **2022-02-28 — Memo Subm…**: A memo was submitted seeking…
- **2022-06-17 — Hearing…**: Hearing held on 17.06.2022 at 10.30…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 19(2) — Personnel to extend co-operation to interim…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-19)

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