Indian Tax Update - Section 12A withdrawal rejected when filed before Committee of Creditors formation despite partial settlement

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Section 12A withdrawal rejected when filed before Committee of Creditors formation despite partial settlement

NCLAT upheld NCLT's rejection of Section 12A withdrawal application filed before Committee of Creditors constitution. Corporate debtor's Interim Resolution Professional filed withdrawal application after settling dues with one financial creditor, but another financial creditor timely filed claims and objected. NCLAT held that when CoC is not constituted, stakeholders may directly approach NCLT under Regulation 30A of CIRP Regulations. Adjudicating Authority properly considered relevant factors including nature and quantum of claims, noting NCLT is not merely a post office for Section 12A applications. Court emphasized no rigid formula exists for deciding withdrawal applications; each case requires fact-specific analysis considering objecting stakeholders' claims and settlement amounts with other creditors.


Categories: TaxLaws, Highlights, TaxTMI
Source: https://www.taxtmi.com/highlights?id=89973 Jul 01, 2025, 10:00 AM