14 February 2019: The National Company Law Appellate Tribunal (NCLAT) has set aside the National Company Law Tribunal (NCLT) Kolkata bench’s order to start insolvency proceedings against Eastern Coalfields (ECL), a subsidiary of Coal India, said an official on Thursday.
The state-run miner had moved the NCLAT challenging the order.
“The NCLAT has set aside the NCLT order and it has released us from all the rigour of law. We are allowed to function independently through our board,” an ECL official told IANS.
THe NCLT’s city bench, in December, admitted an insolvency petition, filed by the Gulf Oil Lubricants India, against ECL under Section 9 of the Insolvency & Bankruptcy Code, as it allegedly refused to pay the interest amount at the rate of 18 per cent on the original debt to the operational creditor.
ECL had already paid the Rs 84.71 lakh principal sum to the creditor.
At the hearing, the counsel appearing for the operational creditor, accepted that the principal was paid prior to the admission of the insolvency application.
“That the parties have settled the matter prior to the constitution of the committee of creditors and the adjudicating authority has failed to notice that the principal has been paid and original plea of the corporate debtor was that no interest was payable in terms of the agreement/contract, we set aside the impugned order dated December 19, 2018 passed by the adjudicating authority,” the NCLAT bench said.