IBC wins against taxman, yet again
The Supreme Court has ruled that the Insolvency and Bankruptcy Code (IBC) will override Income-Tax rules on claims. “Given Section 238 of the Insolvency and Bankruptcy Code, 2016, it is obvious that the Code will override anything inconsistent contained in any other enactment, including the Income-Tax Act,” the Bench comprising Justice Rohinton Fali Nariman and Justice Indu Malhotra ruled recently, in a case between the PR Commissioner of Income Tax-6, New Delhi, and Monnet Ispat & Energy Limited. The apex court thus upheld a Delhi High Court ruling that had held that a moratorium under the IBC will apply to the order of the Income-Tax Appellate Tribunal.
NCLAT grants stay on liquidation order passed against Jyoti Structures
The National Company Law Appellate Tribunal (NCLAT) has granted a stay on the liquidation order passed against insolvent firm Jyoti Structures. The stay order comes after a group of investors led by Sharad Sanghi and 800 employees of the corporate debtor appealed against it. Jyoti Structures is the first case ordered for liquidation from the Reserve Bank of India’s first list of 12 large corporate debtors to be admitted for insolvency proceedings. Sanghi, the founder of Netmagic Solutions, and a group of investors were the only applicants interested in acquiring the company.
Tribunal allows banks to recover loans by selling Jatin Mehta’s assets
A tribunal has allowed a consortium of lenders, led by Standard Chartered Bank, to sell the properties it took as collateral from companies promoted by fugitive Jatin R Mehta and others. These properties, owned by Winsome Diamonds & Jewellery, were attached by the Enforcement Directorate (ED), which claimed that these were from the proceeds from money laundering. As a result, banks could not sell these and recover their dues. A Delhi-based appellate tribunal under the Prevention of Money Laundering Act dismissed the attachment made by the ED and allowed banks to sell them to recover their loans to the tune of Rs 40 billion.
NGT remits Vedanta’s plea on Sterlite plant to panel headed by former judge
The National Green Tribunal (NGT) remitted on Monday mining company Vedanta’s plea, challenging closure of its Sterlite copper plant at Tuticorin, to a committee headed by a former judge. A bench headed by chairperson A K Goel, said that the committee will also include representatives of the Central Pollution Control Board and the Environment Ministry. We are of the view that in substitution of the impugned orders, we have to hear before an independent body and remit the matter for fresh consideration before the committee,” the bench said.
RBI stands firm: ‘Power sector has chronic defaulters’
In a stern rebuttal of the power ministry’s contention that only “external factors” are to be blamed primarily for the high incidence of stress in the power sector, the Reserve Bank of India (RBI) on Monday informed the Allahabad High Court that the industry had seen many “chronic defaulters” much before its contentious February circular. The central bank also said that many private power producers were “suppressing facts” and presenting a distorted view of the potential impact of the circular on them. Under-construction power assets such as Athena Energy’s 1,200 MW Chhattisgarh plant, East Coast Energy’s 1,320 MW Andhra Pradesh units, Lanco’s 1,320 MW plant in Odessa had been referred to the National Company Law Tribunal (NCLT) before the RBI’s circular that tightened the norms for bad loans recognition and resolution.
UTI: Fresh salvo by SBI even as government talks peace
State Bank of India has fired a fresh salvo in the battle of control over UTI even as the government and UTI’s largest investor, US investment firm T Rowe Price (TRP), are trying to hammer out a peace settlement. In a letter to the UTI Trustee Company on Saturday, SBI has asked for the removal of Ashok K Kini as a director on its board. Kini heads the UTI Trustee Board which, in line with Securities and Exchange Board of India (Sebi) regulations for mutual funds, had asked that the four PSU shareholders — including SBI — lower their equity in UTI to 10% each from the present 18.25%.
Firm sues TCS for IP infringement in US
US-based Simonelli Innovation LLC has sued Tata Consultancy Services Ltd (TCS) in a Texas court, alleging India’s largest information technology (IT) outsourcing firm wrongfully used its intellectual property (IP) and trade secrets to build its own consulting practice. Simonelli, a privately held consulting firm in Texas, accused TCS of misusing Simonelli’s trade secrets and confidential information and sought a jury trial, seeking compensation for loss in revenue on account of TCS using its consulting offering solutions. “This case is being brought because TCS and TAIC (Tata America International Corp.) agreed to keep the IP and trade secrets of Simonelli Innovation confidential and to only use same in projects under the ‘Alliance Agreement’ that would mutually benefit both entities,” reads Simonelli’s lawsuit dated 15 August, filed in the western district of Texas.
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