# In the matter of Shah Group Builders Limited IA No. 1882 & 2209 -2021, IA No. 1670 & 1901-2022 in CP (IB) No. 2207-MB-C-IV-2019

> NCLT judgment dated 2023-03-17. Citation: TCN-2023-NCLT-04155. The case involves an application filed by the Interim Resolution Professional (IRP) under…

- **Court:** NCLT
- **Order date:** 17 Mar 2023
- **Citation:** TCN-2023-NCLT-04155
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/shah-group-builders-limited-ia-no-1882-2209-2021-ia-no-1670-1901-2022-in-cp-ib-n-959b1610

## Summary

### Background

The case involves an application filed by the Interim Resolution Professional (IRP) under Section 12A of the Insolvency and Bankruptcy Code (IBC) for the withdrawal of the Corporate Insolvency Resolution Process (CIRP) initiated against Shah Group Builders Limited. The CIRP was initiated on 2021-10-04, and the order was challenged before the NCLAT. An interim stay was granted on 2021-08-06, directing not to constitute the Committee of Creditors (CoC) and allowing the Corporate Debtor and Financial Creditor to settle the matter, which was finalized on 2021-09-20. Several Interlocutory Applications (IAs) were filed by various parties, including Canara Bank, Edelweiss Asset Reconstruction Company Limited, and Shah Kingdom Cooperative Housing Society Limited, opposing the

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## Facts

The key facts are as follows: A CIRP was initiated against Shah Group Builders Limited on 2021-10-04. The order was challenged before the NCLAT, which granted an interim stay on 2021-08-06, preventing the constitution of the CoC. The Financial Creditor and Corporate Debtor reached a settlement agreement on 2021-09-20. The IRP filed an application under Section 12A of the IBC for withdrawal of the CIRP. Several other creditors, including Canara Bank and Edelweiss Asset Reconstruction Company Limited, filed IAs opposing the withdrawal. The promoters of the Corporate Debtor filed an IA supporting the withdrawal. The Financial Creditor submitted Form-FA, indicating their consent for the withdrawal. The Corporate Debtor's counsel confirmed that the IRP's fees and CIRP costs

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## Issues and analysis

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

**Ratio:** Section 12A of the IBC allows for the withdrawal of an application admitted under Section

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**Reasoning:** The court reasoned that since the CoC had not been constituted, there was no bar to the

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**Interpretation:** Section 12A of the IBC is interpreted to permit withdrawal of CIRP applications

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**Application:** In this case, the CoC had not been constituted, and the Financial Creditor had

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## Parties

- **Judges:** Prabhat…; KISHORE VEMULAPALL…
- **Appellants:** Sudha P. Na…
- **Respondents:** Shah Group…; Nalin Virj…

## Timeline

- **2021-10-04 — CIRP Init…**: Corporate Insolvency Resolution Process (CIRP) initiated against Shah Group Builders…
- **2021-08-06 — Interim Stay…**: NCLAT granted an interim stay, directing not to constitute the Committee of Creditors…

## 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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