Noida authority not to be part of committee of creditors, says litigant after SC order
India Today
Following the Supreme Court's ruling that Noida is an operational creditor, one of the litigants on Wednesday said that the Noida authority will not be a part of the creditors' committee.
After the Supreme Court ruled that New Okhla Industrial Development Authority (Noida) is an operational creditor rather than a financial creditor under the Insolvency and Bankruptcy Code (IBC), one of the case's litigants stated that the Noida authority will not be part of a creditors' committee.
"The court's order means Noida authority will not be in the committee of creditors anymore. Only the bank, the homebuyers and the company will be there. There will be no voting rights either for Noida authority in any of the important decisions taken by the committee of creditors," the litigant, Manish Gupta, stated.
"This means the Noida authority's dues, which were multiplied over the period on the default builder who is seeking insolvency, will be reduced as the amount will be decided by the group of creditors and not by the authority," said Gupta, who is also a chartered accountant (CA) and an insolvency expert lawyer.
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In the case of New Okhla Industrial Development Authority vs. Anand Sonbhadra, the Supreme Court has ruled that Noida is an operational creditor and not a financial creditor under the provisions of the Insolvency and Bankruptcy Code, 2016. (IBC)
The judgment was delivered by a bench of Justice KM Joseph and Justice Hrishikesh Roy on an appeal filed by the Noida authority. The Noida authority had challenged the judgment of the National Company Law Appellate Tribunal (NCLAT) which held that the Noida authority is an operational creditor under the IBC and not a financial creditor of the corporate debtor as per the provisions of the IBC.
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