# In the matter of Shah Housecon Private Limited IA (I.B.C)-2393(M B)2022 in C.P. (IB)-59(MB)2022

> NCLT judgment dated 2022-09-05. Citation: TCN-2022-NCLT-01175. The case involves an application (IA 2393 of 2022) filed by the Interim Resolution Professional…

- **Court:** NCLT
- **Order date:** 5 Sept 2022
- **Citation:** TCN-2022-NCLT-01175
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/shah-housecon-private-limited-ia-ibc-2393m-b2022-in-cp-ib-59mb2022-17f319d4

## Summary

### Background

The case involves an application (IA 2393 of 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 dated 19.07.2022, which was passed against the Corporate Debtor. The matter was settled between the parties through a settlement agreement dated 22.08.2022, before the constitution of the Committee of Creditors (COC).

## Facts

The Interim Resolution Professional (IRP) filed IA 2393 of 2022 under Section 12A of the Insolvency and Bankruptcy Code seeking withdrawal of the CIRP order dated 19.07.2022, which was initiated against Shah Housecon Private Limited. The application was filed because the parties, namely Nidhaan Enterprises (Financial Creditor) and Shah Housecon Private Limited (Corporate Debtor), reached a settlement agreement dated 22.08.2022 before the Committee of Creditors (COC) could be constituted. As per the settlement, the Corporate Debtor agreed to pay Rs. 1,50,00,000/- to the Financial Creditor. The IRP also confirmed that he had received the CIRP costs, including his fees. The key fact is the settlement reached before COC formation, justifying the withdrawal of CIRP.

## Issues and analysis

### Issue 1: Whether the application for withdrawal of the CIRP under Section 12A of the Insolvency and …

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

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**Reasoning:** The court reasoned that since the COC was not constituted, the requirement for 90%

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**Interpretation:** Section 12A is interpreted to allow for flexibility in withdrawing CIRP,

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**Application:** In this case, the court applied the principle that since the COC was not

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## Parties

- **Judges:** ANURADHA SANJAY…; H.V. Subb…
- **Appellants:** NIDHAAN ENTERPRISE…
- **Respondents:** SHAH HOUSECON…

## Timeline

- **2022-07-19 — CIRP Ord…**: CIRP order passed…
- **2022-08-22 — Settlement Ag…**: Settlement agreement dated 22.08.2022 entered into between the parties before the…

## 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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