The question under consideration before the Bombay High Court was whether the actions of the NCLT in (a) not providing an opportunity to Marvel to file its reply to the Company Petition filed by ICICI (“Company Petition”) under Section 7 of the Insolvency and Bankruptcy Code, 2016 (“IBC”); (b) not providing an opportunity to Marvel make submissions on merits; and (c) orally indicating that the order of admission is being passed in the Company Petition in accordance with the IBC, were violative of principles of natural justice. Owing to the same the NCLT, Marvel had preferred a writ petition challenging the order dated July 20, 2022 passed by the NCLT wherein the Company Petition was admitted and moratorium under Section 14 of the IBC was imposed upon Marvel (“Impugned Order”).
The Bombay High Court after hearing the submissions made by the parties allowed the Writ Petition on the grounds that the Impugned Order was violative of the principles of natural justice. The Bombay High Court held that the NCLT ought not to have refused Marvel the opportunity to file its reply to the Company Petition and should have permitted Marvel to advance oral submissions. The Bombay High Court after hearing the parties, set aside the Impugned Order and restored the Company Petition to file.
The NCLT, Mumbai had, without granting any opportunity to Marvel passed an admission order admitting Marvel into CIRP under the IBC. As the principles of natural justice were not adhered to, Marvel preferred a writ before the Bombay High Court impugning the admission order. The Bombay High Court had to consider the maintainability of the writ petition, as there was an alternate remedy (i.e. appeal before the NCLAT) available to Marvel.
Deal Value: Approx. US$ 22.75 million
JSA Dispute Team Lead Partner – Varghese Thomas, Partner – Hormuz Mehta, Associate – Ahsan Allana and Akhil Nene.