NCLT Rejected Re-Filing of Insolvency Petition by FC, as AA Did Not Allow Re-Filing Post-Settlement Failure

Case Details: Subham Capital (P.) Ltd. v. Vedic Realty (P.) Ltd. - [2024] 169 taxmann.com 466 (NCLT-Kolkata)

Judiciary and Counsel Details

• Smt. Bidisha Banerjee, Judicial Member & D. Arvind, Technical Member
• Joy Saha, Sr. Adv., S. Mitra, Shounak Mitra, Ms V. Panday & A. Sarkar, Advs. for the Applicant.
• Ms Urmila Chakraborty & Ms M. Barman, Advs. for the Respondent.

Facts of the Case

In the instant case, the Applicant-financial creditor had granted loan to the respondent-corporate debtor. The financial creditor filed a petition under section 7 of the IBC against the corporate debtor.

During pendency of the said petition, the parties entered into a settlement agreement and, on basis of the said settlement agreement, the petition was dismissed as withdrawn.

The corporate debtor made some payments but later dishonoured several cheques. Consequently, the financial creditor filed the instant petition under section 7 of the IBC on the ground of default in payment in terms of the settlement agreement.

The corporate debtor alleged that the previous petition was withdrawn without leave to file a fresh petition, hence, the instant petition was not maintainable on self-same cause of action.

NCLT Held

The NCLT held that, if withdrawal is allowed without liberty to come afresh in respect of the same subject matter, that would be absolute withdrawal, and the applicant cannot be permitted to proceed again on the same cause of action. Further, since the previous petition was withdrawn by the financial creditor himself and the NCLT had not given any liberty to come up afresh if settlement failed, the instant petition was not maintainable.

List of Cases Referred to

• Sarguja Transport Service v. State Transport Appellate Tribunal, M.P. Gwalior & Ors (1987) 1 SCC 5 (para 33 and 51)
• Swiss Ribbons Private Limited v. Union of India (2019) 4 SCC 17 (para 35)
• Global Credit Capital Limited v. Sach Marketing Pvt. Ltd 2024 SCC OnLine SC 649 (para 64).