#How to file a case with NCLT

[legalfirmindia]

Unraveling Corporate Legal Complexities: Navigating NCLT for Your Business Success

Navigating NCLT for Your Business Success: The ever-changing landscape of Indian business throws a multitude of legal hurdles your way. In the midst of strategizing for market dominance and maximizing profits, navigating the labyrinth of corporate law can feel overwhelming. However, fret not! This is where Empower Legal steps in – your trusted companion on the path to business…

[vmls123]

Mediation for Operational Creditors: A New Dawn in India's Insolvency Framework

The Insolvency and Bankruptcy Board of India (IBBI) has put forward an innovative plan aimed at streamlining the resolution process for operational creditors (OCs). By allowing pre-institutional mediation before submitting insolvency applications under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016, the initiative seeks to promote early dispute resolution, lessen the load on adjudicating authorities, and speed up proceedings. While this concept holds great potential, its success will depend on how well it is implemented and the readiness of stakeholders to adapt to these changes. This development is particularly relevant for professionals and students pursuing an LLB degree course at a law university in Chennai or any of the best law colleges in India, as it represents a significant shift in insolvency law.

Mediation is increasingly seen as a quicker and less confrontational way to resolve disputes. It enables operational creditors and corporate debtors to have meaningful discussions with the help of a trained mediator. Rather than getting caught up in lengthy court battles, both parties can work together to tackle issues, which saves time, money, and effort. In addition to these practical advantages, mediation helps maintain important business relationships that could be damaged by litigation. For companies, collaborating to resolve disputes is much more advantageous than turning into opponents. The importance of this approach is highlighted by data showing that by April 2024, more than 21,000 Section 9 cases were settled before formal admission, while only around 3,800 progressed to full insolvency proceedings. This suggests that most disputes are resolved before they escalate into advanced litigation, emphasizing mediation’s role as an effective pre-litigation strategy. Law students studying at the best private law colleges in India or aspiring for an LLB degree course can gain valuable insights from such mediation strategies in insolvency law.

Under the proposed framework, operational creditors can opt for mediation before filing their insolvency application. Disputes commonly revolve around payment delays, quality of goods or services, or contractual disagreements. A mediator appointed under the Mediation Act, 2023, will guide the discussions between the parties. If the mediation is successful, the dispute is resolved without involving the National Company Law Tribunal (NCLT). However, in case of failure, the mediator will issue a non-settlement report, which the creditor can annex to the insolvency application when initiating formal proceedings. This approach balances the need for efficiency with the flexibility to pursue formal insolvency resolution if required. The growing emphasis on mediation in India’s legal system makes it a crucial area of study for students enrolled in a law college or one of the best colleges for law in the country.

While the benefits of this initiative are apparent, challenges remain. Mediation is voluntary, which means its success depends on the willingness of both parties to participate in good faith. There is also the risk that corporate debtors may exploit mediation as a stalling tactic to delay creditors’ access to formal proceedings. For smaller creditors, the lack of bargaining power could pose additional challenges, particularly when negotiating with larger and more resourceful corporate debtors. Furthermore, the enforcement of mediation outcomes relies on voluntary compliance, and any breach of the agreement could force creditors back into lengthy legal battles, defeating the purpose of the initiative. The practical challenges associated with mediation are an important area of legal study, making it an essential topic for those pursuing an LLB degree course at a law university in Chennai or any of the best law colleges in India.

Despite these concerns, the potential for pre-institutional mediation to reshape India’s insolvency framework is significant. To ensure its success, several measures must be implemented. These include developing a strong pool of trained mediators, increasing awareness among creditors and debtors about the advantages of mediation, and offering support mechanisms such as legal aid for smaller creditors to create a more equitable environment. Furthermore, establishing transparent monitoring systems to track mediation outcomes can promote accountability and enhance the process over time. As alternative dispute resolution methods gain traction, legal education institutions, including the best private law colleges in India, are integrating these concepts into their curricula to prepare future legal professionals.

If executed properly, pre-institutional mediation could serve as a fundamental element of India’s insolvency framework. It provides operational creditors with a faster, more cost-effective method to recover their dues while alleviating the burden on an overloaded judiciary. By encouraging a culture of dialogue and cooperation, this initiative has the potential to foster a more efficient and balanced insolvency ecosystem that benefits all parties involved. For operational creditors, it is not just a means of resolving disputes but also a move towards establishing a fairer and more streamlined process for achieving justice. Law students and professionals from the best colleges for law can look forward to new opportunities in insolvency law and mediation, further expanding their career prospects.

[sasiblogs]

Closure of a Private Limited Company: A Simple Guide

Starting a private limited company is exciting, but sometimes business owners may close it for various reasons, like low profits, no business activity, or a change in plans. If you’re considering shutting down your company, knowing the right process is important. This guide will help you understand how to close a private limited company smoothly and legally.

Why Close a Private Limited Company?

There can be many reasons to close a company, such as:

The business is no longer active or running.

The company is not making a profit.

There is no plan to operate the business.

Owners want to start something new.

Legal or financial issues.

Whatever the reason may be, it’s better to officially close the company rather than keep it running on paper, which can lead to penalties and compliance issues.

Ways to Close a Private Limited Company

There are mainly two ways to close a private limited company in India:

1. Voluntary Closure (Strike Off under Fast Track Exit Scheme)

This is the simplest way to close a company that is not operating anymore. It can be done by applying to the Registrar of Companies (ROC) for a strike-off.

Conditions for Strike Off:

The company should not have been active for the last two years.

There should be no business transactions.

All financial statements and compliance filings must be done.

Steps for Strike Off:

Hold a board meeting and pass a resolution to close the company.

Get approval from shareholders.

Clear all dues and liabilities.

File Form STK-2 with ROC.

Attach necessary documents like board resolution, affidavits, an indemnity bond, and a statement of accounts.

Wait for ROC approval and publication in the official gazette.

2. Compulsory Closure (By ROC or NCLT)

If a company is inactive but does not apply for closure, the ROC can strike it off. In some serious cases (like fraud or legal violation), the company may be shut down by the National Company Law Tribunal (NCLT).

Important Documents Needed

Board Resolution

Shareholders’ Consent

Affidavit from Directors

Indemnity Bond

Statement of Accounts (not older than 30 days)

PAN & Aadhaar of Directors

Things to Keep in Mind

Make sure all taxes and dues are cleared.

File all pending returns before applying for closure.

Inform all stakeholders (like banks, employees, and vendors).

Close the company’s bank accounts before applying.

Benefits of Proper Closure

No future penalties or compliance issues.

Clean exit from the business.

Peace of mind for directors and shareholders.

Avoids blacklisting by government authorities.

Conclusion

Closing a private limited company is a legal process, and doing it the right way is very important. Whether the business didn’t go as planned or you simply want to move on, striking off your company officially is the best decision. It not only saves you from future troubles but also gives you a fresh start for new opportunities.

[renukamd]

How to Close a Private Limited Company in India: Step-by-Step Guide to Company Closure

The closure of a Private Limited Company (Pvt Ltd) in India involves specific legal and procedural steps. Whether the business is shutting down due to financial troubles, business strategy shifts, or any other reason, it's essential to follow the proper guidelines to avoid legal complications. In this article, we’ll discuss the various methods of closing a Private Limited Company and the necessary steps involved in each process.

Reasons for Closing a Private Limited Company

There can be several reasons for a Private Limited Company to shut down, including:

Insolvency or Bankruptcy: When the company is unable to meet its financial obligations.

Operational Losses: Continuous operational losses that make it unfeasible to continue the business.

Non-Compliance: Failing to meet the legal and regulatory compliance, leading to a decision to wind up.

Voluntary Exit: The directors or shareholders may decide to close the business if they no longer wish to continue the operations.

Methods of Closure

1. Striking Off by Registrar of Companies (ROC)

The Registrar of Companies (ROC) can strike off a company from its register if it fails to comply with statutory requirements, such as:

Not commencing business within one year of incorporation.

Inactive for two years or more.

In this case, the ROC initiates the closure, and the company is removed from the official register. This is known as compulsory strike-off.

2. Voluntary Strike Off under Section 248 of the Companies Act, 2013

This is a voluntary process where the directors of the company themselves file for closure under Section 248(2) of the Companies Act 2013. A company can apply for voluntary strike-off if:

It has not carried on any business for two years immediately preceding the date of application.

It has yet to carry on any business since incorporation.

Steps for Voluntary Strike Off:

Board Meeting: Conduct a board meeting to pass a resolution for the closure of the company.

Approval from Shareholders: Pass a special resolution in the general meeting, with the approval of at least 75% of the shareholders.

Explicit All Liabilities: Before applying, ensure that all company liabilities are cleared.

Application to ROC: Submit Form STK-2 to the ROC, along with the necessary documents.

Publishing in the Official Gazette: Once the application is approved, the ROC will publish the company’s name in the Official Gazette, declaring it closed.

3. Winding Up through the National Company Law Tribunal (NCLT)

Winding up through NCLT is a formal and more structured process that is typically followed in cases of insolvency or financial issues or when creditors seek closure to recover debts.

Types of Winding Up:

Voluntary Winding Up: When the company decides to shut down with the approval of its members.

The tribunal orders Compulsory Winding up when a company is unable to pay its debts or meets other statutory conditions for winding up.

Steps for NCLT Winding Up:

Board Resolution: The board must pass a resolution to wind up the company.

Shareholder Approval: The shareholders need to approve the decision in a general meeting.

Appointment of Insolvency Professional: An insolvency professional is appointed to oversee the liquidation process.

Filing of Petition: The petition for winding up is submitted to NCLT.

Tribunal Orders Liquidation: Once approved, the tribunal orders the company’s liquidation, and an official liquidator is appointed.

Disposal of Assets and Settlement of Liabilities: The liquidator sells the assets and settles the liabilities before dissolving the company.

4. Fast Track Exit (FTE) Scheme

The Fast Track Exit (FTE) scheme is designed for dormant companies that are not in operation but wish to avoid undergoing the lengthy winding-up process. It’s a simplified way for a defunct company to close operations without going through NCLT.

Eligibility for FTE:

The company has no liabilities.

The company has not been involved in any business activity for at least one year.

Under this scheme, the company applies to the ROC, and once the ROC reviews and accepts the application, the company is struck off the register.

Key Documents Required for Closure

The following documents are typically required to close a Private Limited Company:

Board Resolution approving the closure of the company.

Shareholders' Resolution (special resolution with 75% majority).

An Indemnity Bond must be signed by all directors in Form STK-3.

Affidavit from the directors in Form STK-4.

Statement of Accounts is, at most, not showing assets or liabilities.

A copy of the Special Resolution was filed in Form MGT-14.

NOC from Creditors (if applicable).

Tax Clearance Certificate from the income tax department.

Timeframe for Closure

The time it takes to close a Private Limited Company depends on the method chosen. A voluntary strike-off can take 3 to 6 months, while winding up through NCLT can take much longer, typically 6 months to a few years, depending on the complexity of the case.

Conclusion

Closing a Private Limited Company is a significant legal procedure that requires compliance with various legal steps and filings. Whether opting for a voluntary strike-off, compulsory winding up, or fast-track exit, it is crucial to ensure all statutory obligations are met and liabilities are settled. All directors must sign an Indemnity bond. Consulting with legal experts or corporate advisors can help streamline the process and avoid future complications.

[kanakkupillai-trademark]

How to Legally Wind Up Your Private Limited Company

Closure of Private Limited Company in India: A Comprehensive Guide

The closure of a Private Limited Company (Pvt Ltd) in India involves specific legal and procedural steps. Whether the business is shutting down due to financial troubles, business strategy shifts, or any other reason, it's essential to follow the proper guidelines to avoid legal complications. In this article, we’ll walk you through the various methods of closing a Private Limited Company and the necessary steps involved in each process.

Reasons for Closing a Private Limited Company

There can be several reasons for a Private Limited Company to shut down, including:

Insolvency or Bankruptcy: When the company is unable to meet its financial obligations.

Operational Losses: Continuous operational losses that make it unfeasible to continue the business.

Non-Compliance: Failing to meet the legal and regulatory compliance, leading to a decision to wind up.

Voluntary Exit: The directors or shareholders may decide to close the business if they no longer wish to continue the operations.

Methods of Closure

1. Striking Off by Registrar of Companies (ROC)

The Registrar of Companies (ROC) can strike off a company from its register if it fails to comply with statutory requirements, such as:

Not commencing business within one year of incorporation.

Inactive for two years or more.

In this case, the ROC initiates the closure, and the company is removed from the official register. This is known as compulsory strike-off.

2. Voluntary Strike Off under Section 248 of the Companies Act, 2013

This is a voluntary process where the directors of the company themselves file for closure under Section 248(2) of the Companies Act 2013. A company can apply for voluntary strike-off if:

It has not carried on any business for two years immediately preceding the date of application.

It has yet to carry on any business since incorporation.

Steps for Voluntary Strike Off:

Board Meeting: Conduct a board meeting to pass a resolution for the closure of the company.

Approval from Shareholders: Pass a special resolution in the general meeting, with the approval of at least 75% of the shareholders.

Explicit All Liabilities: Before applying, ensure that all company liabilities are cleared.

Application to ROC: Submit Form STK-2 to the ROC along with the necessary documents.

Publishing in Official Gazette: Once the application is approved, the ROC will publish the company’s name in the Official Gazette, declaring it closed.

3. Winding Up through the National Company Law Tribunal (NCLT)

Winding up through NCLT is a formal and more structured process that is typically followed in cases of insolvency, financial issues, or when creditors seek closure to recover debts.

Types of Winding Up:

Voluntary Winding Up When the company decides to shut down with the approval of its members.

The tribunal orders Compulsory Winding up when a company is unable to pay its debts or meets other statutory conditions for winding up.

Steps for NCLT Winding Up:

Board Resolution: The board must pass a resolution to wind up the company.

Shareholder Approval: The shareholders need to approve the decision in a general meeting.

Appointment of Insolvency Professional: An insolvency professional is appointed to oversee the liquidation process.

Filing of Petition: The petition for winding up is submitted to NCLT.

Tribunal Orders Liquidation: Once approved, the tribunal orders the company’s liquidation, and an official liquidator is appointed.

Disposal of Assets and Settlement of Liabilities: The liquidator sells the assets and settles the liabilities before dissolving the company.

4. Fast Track Exit (FTE) Scheme

The Fast Track Exit (FTE) scheme is designed for dormant companies that are not in operation but wish to avoid undergoing the lengthy winding-up process. It’s a simplified way for a defunct company to close operations without going through NCLT.

Eligibility for FTE:

The company has no liabilities.

The company has not been involved in any business activity for at least one year.

Under this scheme, the company applies to the ROC, and once the ROC reviews and accepts the application, the company is struck off the register.

Key Documents Required for Closure

The following documents are typically required to close a Private Limited Company:

Board Resolution approving the closure of the company.

Shareholders Resolution (special resolution with 75% majority).

Indemnity Bond signed by all directors in Form STK-3.

Affidavit from the directors in Form STK-4.

Statement of Accounts is not older than 30 days and shows no assets or liabilities.

A copy of the Special Resolution was filed in Form MGT-14.

NOC from Creditors (if applicable).

Tax Clearance Certificate from the income tax department.

Timeframe for Closure

The time taken to close a Private Limited Company depends on the method chosen. Voluntary strike-off can take around 3 to 6 months, while winding up through NCLT can take much longer, typically six months to a few years, depending on the complexity of the case.

Conclusion

Closing a Private Limited Company is a significant legal procedure that requires compliance with various legal steps and filings. Whether opting for voluntary strike-off, compulsory winding up, or fast-track exit, it is crucial to ensure all statutory obligations are met and liabilities settled. Consulting with legal experts or corporate advisors can help streamline the process and avoid future complications.

[bhattandjoshiassociates-blog]

Section 10A of IBC and Corporate Guarantee: A Case Analysis

How the NCLAT interpreted the suspension of insolvency proceedings for defaults arising during the COVID-19 pandemic in relation to a corporate guarantee invoked after March 25, 2020. Introduction The Insolvency and Bankruptcy Code (IBC), 2016, is a comprehensive legislation that provides a time-bound and creditor-driven mechanism for resolving the insolvency and bankruptcy of corporate entities, partnership firms and individuals in India. The IBC aims to maximise the value of assets, promote entrepreneurship, ensure availability of credit and balance the interests of all stakeholders,the government introduced Section 10A of IBC . However, due to the unprecedented situation caused by the COVID-19 pandemic, many businesses faced financial distress and were unable to repay their debts. To protect such businesses from being dragged into insolvency proceedings by their creditors, the government introduced Section 10A of IBC by an ordinance in June 2020. Section 10A suspends the initiation of corporate insolvency resolution process (CIRP) for any default arising on or after March 25, 2020, for a period of six months or more, as notified by the government. The proviso to Section 10A states that no application for CIRP shall ever be filed for the default occurring during the suspension period. One of the issues that arose in relation to Section 10A was whether it applies to a corporate guarantee invoked after March 25, 2020, for a default committed by the principal borrower before March 25, 2020. This issue was recently decided by the National Company Law Appellate Tribunal (NCLAT) in the case of Vikram Kumar vs Aranca Mumbai Pvt. Ltd… This article analyses the facts, arguments and judgment of this case and discusses its implications for the interpretation and application of Section 10A of IBC. Facts of the case The appellant, Vikram Kumar, was the proprietor of Aranca Research India Pvt. Ltd., a company engaged in providing research and analytics services. The respondent, Aranca Mumbai Pvt. Ltd., was another company engaged in similar business activities. The appellant’s company had taken a loan of Rs. 2.5 crore from the respondent’s company in March 2019. The appellant had given a corporate guarantee to secure the repayment of the loan. The loan agreement stipulated that in case of default by the principal borrower, the respondent could invoke the corporate guarantee and demand repayment from the guarantor. The appellant’s company defaulted in repaying the loan and the respondent invoked the corporate guarantee on April 1, 2020. The respondent sent a demand notice to the appellant asking him to repay Rs. 2.63 crore within seven days. The appellant failed to repay and the respondent filed an application for CIRP against him under Section 7 of IBC before the National Company Law Tribunal (NCLT), Mumbai Bench on September 29, 2020. The NCLT rejected the application on December 18, 2020, on the ground that it was barred by Section 10A of IBC as the default arose during the suspension period from March 25, 2020 to March 24,2021. The appellant challenged the order of the NCLT before the NCLAT on January 4, 2021. Arguments before the NCLAT The appellant submitted that Section 10A does not apply to his case as he is a personal guarantor and not a corporate debtor. He also submitted that his default was not a fresh default but a continuation of the default by his company, which occurred before March 25, 2020. He argued that Section 10A only bars applications for CIRP for defaults arising on or after March 25, 2020 and not for defaults arising before that date. The respondent submitted that Section 10A applies to all applications for CIRP under Section 7,9 or 10 of IBC irrespective of whether they are filed against corporate debtors or personal guarantors. He also submitted that the invocation of the corporate guarantee was a fresh default by the appellant as it occurred after March 25, 2020 and hence it falls within the ambit of Section 10A. He argued that Section 10A prohibits any application for CIRP for defaults occurring during the suspension period from March 25,2020 to March24,2021. Judgment of the NCLAT The NCLAT dismissed the appeal and upheld the order of the NCLT on March 15, 2021. The NCLAT held that: - The question that arises for consideration is whether the default committed by the principal borrower prior to 25th March, 2020 would be a fresh default when the Corporate Guarantee is invoked after 25th March, 2020 and whether such invocation of Corporate Guarantee would be covered under Section 10A of the Code. (Para 8) - The default committed by the principal borrower is a continuing default till it is paid or settled. The invocation of Corporate Guarantee is not a fresh default but a continuation of the default committed by the principal borrower. Therefore, the date of default has to be reckoned from the date of default committed by the principal borrower and not from the date of invocation of Corporate Guarantee. (Para 9) - The proviso to Section 10A clearly states that no application shall ever be filed for initiation of CIRP of a corporate debtor for the said default occurring during the said period. The said period means the period beginning from 25th March, 2020 and ending on 24th March, 2021. Therefore, any default occurring during this period is completely excluded for the purpose of initiation of CIRP under Section 7, 9 or 10 of the Code. (Para 10) - The contention of the learned counsel for the appellant that Section 10A applies only to corporate debtors and not to personal guarantors is also devoid of merit. The language of Section 10A does not make any distinction between corporate debtors and personal guarantors. It applies to all applications for initiation of CIRP under Section 7, 9 or 10 of the Code. Therefore, it covers both corporate debtors and personal guarantors. (Para 11) The NCLAT’s judgment in this case has clarified that Section 10A of IBC applies to both corporate debtors and personal guarantors and that it bars any application for CIRP for defaults arising during the suspension period from March 25, 2020 to March 24, 2021. The NCLAT has also held that the invocation of a corporate guarantee after March 25, 2020 does not create a fresh default but is a continuation of the default by the principal borrower. This implies that if the principal borrower had defaulted before March 25,2020, then the guarantor cannot be subjected to CIRP even if the guarantee is invoked after March 25,2020. This judgment is in line with the objective of Section 10A, which is to protect the businesses from insolvency proceedings due to the impact of the COVID-19 pandemic. However, it may also have some adverse consequences for the creditors who have relied on corporate guarantees to secure their loans. It may also create uncertainty and confusion regarding the status and enforceability of corporate guarantees given before March 25, 2020. Therefore, it is advisable for both creditors and guarantors to review their loan agreements and corporate guarantees in light of Section 10A and seek legal advice before initiating or defending any insolvency proceedings.     Read the full article

[rusykohli]

From The Bubonic Plague To COVID-19: Impact On The Legal Profession In India

https://www.barandbench.com/author/rusy-kohli

The COVID-19 Pandemic has fundamentally disrupted our social and economic order. It has affected the functioning of most institutions and the Indian Judiciary is no exception. The Guardian of Law now finds itself compelled to guard against this deadly virus, its fraternity and litigants alike. The declaration of lockdown in India was accompanied with Courts across the country restricting functioning to limited matters in order to curb the number of lawyers / litigants entering court complexes. Soon, all hearings were being conducted through videoconferencing only, in order to avoid any human contact whatsoever. However, just like previous health emergencies in India like the Bubonic Plague of the late 19th century and the Spanish Flu of 1918, Corona Virus has made many its victims including the Judiciary, and the legal profession.  In order to fully appreciate the impact of the virus, the author attempts to provide an account of the effect of Covid-19 with reference to historical health emergencies and their impact on the judicial apparatus.

 Pendency in Indian Courts:

 The Indian Judiciary has been over-burdened for several years and COVID-19 is only adding to this menace. As of May 27, 2020, there are approximately 3.24 crore pending cases in India’s subordinate courts[i] and about 48.2 lakh pending cases in the High Courts[ii].

 The Supreme Court via its Notification dated March 13, 2020 restricted functioning of the Court to “ urgent matters ” only ( w.e.f.  March 16, 2020 )[iii], thereby only entertaining bail matters, suspension of sentence matters and the like.

 High Courts too have restricted their functioning to urgent matters. In normal course, a High Court hears north of 400 matters a day. However, since late March, High Courts across the country are hearing anywhere between 10-100 matters a day.[iv]

 Subordinate courts account for over 80 % of the pendency of cases. On April 30, 2020 the Karnataka High Court extended the closure of all District Courts, Family Courts, Labour Courts and Industrial Tribunals in the State until May 16, 2020[v]. On April 29, 2020 the Punjab & Haryana High Court ordered that all the district and sub-divisional Courts in Punjab, Haryana and Chandigarh will function “restrictively” from May 1 “till the lockdown / curfew is in force in the respective area”[vi]. These restrictive measures have led to a glut of pending cases, thereby increasing the burden on courts.

 Justice Delayed Is Justice Denied:

 Pendency in India’s courts has always been a hindrance in securing timely justice for people, if not denying justice altogether. As the usual functioning of courts has been disrupted, many under-trials and even many of those whose appeals are pending are left with no recourse. It can hardly be denied that the subject adage has particular force in the criminal sphere.

 In pursuance of the Apex Court’s directions dated March 23, 2020, States and Union Territories have been asked to constitute High Powered Committees “ to determine which class of prisoners can be released on parole or an interim bail for such period as may be thought appropriate. ” Therefore, each State is free to determine its own criteria for granting bail. Further the Supreme Court has clarified vide its order dated April 13, 2020 that it has not directed the States / Union Territories “ to compulsorily release the prisoners from their respective prisons.”[vii] This clarification has allowed High Courts to further restrict the nature of cases in which they are prepared to grant bail.

 On March 29, 2020, the Insolvency And Bankruptcy Board Of India announced the insertion of regulation “ 40 C ”, which laid down that the period of lockdown imposed in the wake of COVID19 shall not be counted for the purposes of the time-line for any activity that could not be completed due to such lockdown, in relation to the corporate insolvency resolution process ( CIRP )[viii]. While this move has come as a relief for companies undergoing the CIRP, it has left creditors waiting for repayment of dues for longer than the mandated 330-day period. NCLT benches across the country are hearing only urgent matters until the lockdown is lifted. This has left many other matters, which do not qualify as urgent, pending. [ix]

 Plight Of Advocates:

 A PIL was filed in the Supreme Court urging that non-payment of rent for professional premises belonging to advocates should not be made a ground for eviction, during lockdown.  However, on April 30, 2020 the Apex Court refused to entertain the plea remarking that it was "not going to enter into this issue," and dismissed the petition as withdrawn. [x] Further on May 8, 2020 a three- Judge bench of the Supreme Court dismissed a plea urging the court to direct the government to formulate a uniform welfare scheme for lawyers affected across the country.[xi]

 Daily appearances in court are the main source of income for most advocates, and cash flow has come to a drip, if not completely dried up. In the month of April, 82,725 cases were filed in India’s courts as compared to 8,80,000 cases in March [xii]. This steep decline in cases filed has consequently resulted in a significant dip in court fee, besides Lawyers’ income.

 Younger lawyers are left with little or no work. Today, a senior lawyer has the time, and the need to address minor matters, if any, personally, rather than refer them to a junior, which may have been done prior to the lockdown.

 A petition was filed in the Madras High Court, seeking a direction to the State and the Bar Council to release Rs. 50,000/-  to advocates, in order to compensate for the loss of work[xiii]. However, the Bar Council Of Tamil Nadu & Puducherry has resolved to disburse only Rs. 4000/- each to needy lawyers. The Bar Council was not in a position to release any more money because of limited resources.[xiv]

 Law Firms:

 Law Firms have also been severely affected. Many partners have either chosen to renounce salaries this financial year or agreed to take significant pay cuts.  Firms which charged clients anywhere between Rs. 20,000 and Rs 75, 000 per hour, our now renegotiating their fee, since cash-strapped clients are no longer willing to pay exorbitant sums. Moreover, clients are questioning the actual amount of time that firms are spending on their matters, thereby making firms consider implementing technology that would track the number of hours spent by an executive on a client’s job, in order to provide proof to clients[xv]. This is great innovation; however, it comes with a significant cost in a day and age when law firms are suffering unprecedented lows in business.

 Prisoners:

 Corona Virus cases have already sprung up in various jails across India. Amongst other jails, there are over 180 cases in Mumbai’s Arthur Road Jail[xvi]. Authorities have been compelled to take drastic measures such as - release a large number of inmates, shift inmates to different prisons and designate temporary places as jails for keeping new undertrials.

 By end February, nearly the cases (233 of 565) of COVID-19 reported in Wuhan, China, were from the city’s prison system.[xvii] This fact is reflective of just how dangerous prisons are today.

 Indian prisons have historically been overcrowded and may potentially become breeding grounds when threatened by a contagion like Covid19. Considering the difficult living conditions and lack of hygiene, which is an unfortunate reality of our prisons, containing the spread would become nearly impossible.

 Coping With This Challenge:

 We are now in the age of what has come to be known as “Virtual Courts ” which function through videoconferencing, e-filing, telephonic mentioning of urgent matters and online payment of court fees. These are not bereft of teething problems. Perhaps, the biggest drawback of this new system is the inability to provide public access to courtroom proceedings. Virtual proceedings are being held in camera, and are therefore not open to public which is discordant with what has been held in Naresh Shridhar Mirajkar v State of Maharashtra[xviii], where the Apex Court observed that the public has a right to be present in court and to watch proceedings.

 Lawyers are facing problems with basics such as uploading petitions on the Supreme Court website, since the data restrictions put in place are just 5 MB for a petition and 2 MB for additional documents, thereby compelling lawyers to break up the file into multiple volumes.[xix]

 Déjà Vu

 Historically, the Bubonic Plague of the late 19th century and Spanish Flu of 1918 are two points of reference when the entire framework of judiciary was disrupted on account of a health emergency.

 The arrival of the Bubonic Plague in Bombay ( now Mumbai ) in 1896, brought courts to a grinding halt. A J C Mistry, a managing clerk at the Bombay law firm, Wadia Ghandy & Co. has given a grim account of the situation in early 1897. Mistry noted that the judges of the Bombay High Court “had no work to do.” The staff of the firm returned to work after four months, however over the next decade three members fell victim to the plague and died.

Mahatma Gandhi on page 72 in his book -  The Law and The Lawyers[xx], while discussing an appeal which was to be heard in Veraval in Gujarat, writes that there were as many as fifty cases heard daily ( a lot of cases for that day and age ) in the Court at Veraval which had a population of about 5,500 people, however at the time of writing the “plague was raging ” and it was “ practically deserted ”. This anecdote bears a striking semblance to the scenario today.  

 Property which was seized in discharge of debts those days included pots, pans, utensils, bedding etc. These items were regularly hauled in and out of court. Legal historian Mitra Sharafi on page 48 in her book - Law and Identity in Colonial South Asia: Parsi Legal Culture, 1772–1947, writes that this practice of bringing property inside court rooms had become a “ particularly unsavoury phenomenon when the bubonic plague swept through the city. ”

 When the Spanish Flu arrived in 1918, the judiciary was hit once again. Jurors, lawyers and assistants of the Calcutta High Court were severely affected. The Court was functioning on somewhat similar lines of how the courts are functioning today, thereby causing consequent pendency issues. [xxi]

 Even in Bombay, law offices were bought to a standstill. In late June 1918 the Times Of India reported,

 “ Nearly every house in Bombay has some of its inmates down with [influenza] fever and every office is bewailing the absence of clerks. ”

 The flu soon found its way into jails and a need was felt to decongest prisons as inmates began to fall sick and the jails were short-staffed. The District Magistrate of Bijapur particularly wanted to release sick prisoners from jail, but the then Government was not ready to cooperate.[xxii]

 It may be relevant to mention here that an eminent lawyer by the name of, Mohandas Karamchand Gandhi was himself laid down with the Spanish flu with a faltering heartbeat. However, destiny had charted out a different path for him, and India.

 Conclusion:

This piece has only covered some of the ramifications of COVID-19 on the legal profession and there are other areas such as legal education which also need to be addressed on a priority. The existing delays in the legal system will only be exacerbated by the impediments COVID-19 will inevitably present to the progress of investigations, charging decisions, pre-trial processes etc. It appears that Corona Virus is here to stay, and the Judiciary needs to cope with it. We have been through a pandemic before and have come out of it as well. Normal functioning or rather “ New Normal ” functioning of courts is going to take its own time. Hopefully, it shouldn’t take too long, lest Lady Justice will soon have to, along with a blindfold, sword and scales, be adorned with — a mask.

 Rusy Kohli

The author is a Post Graduate from Punjab University and a keen student of current affairs with context to lessons from history.

 [i] “ Pending Dashboard ”: National Judicial Data Grid (District and Taluka Courts of India).

[ii] National Judicial Data Grid For High Courts.

[iii] Supreme Court Notification, March 13, 2020.

[iv] Data collected from Daily Cause Lists of various High Courts.

[v] Vide Notification No. DJA.I/550/1993, dated April 30, 2020.

[vi] Vide Order No. 13/Spl./RG/Misc. , dated April 29, 2020.

[vii] Suo Motu Writ Petition (Civil) No.1 Of 2020 ( In Re : Contagion Of Covid 19 Virus In Prisons ): Order dated April 13, 2020.

[viii] Vide Notification No. IBBI/2019-20/GN/REG059 Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Third Amendment) Regulations, 2020. , dated March 29, 2020

[ix] NCLT Notice dated April 20, 2020.

[x] Writ Petition (Civil) Diary No.11055/2020 ( ALJO K. JOSEPH Vs. UNION OF INDIA & ANR.): Order dated April 30, 2020.

[xi] Writ Petition (Civil) Diary No(S). 11049/2020 ( Abhinav Ramkrishna Vs. Union Of India & Ors. ): Order Dated May 8, 2020

[xii] “ How lockdown has hit judiciary, in numbers — April cases fall to 82k from 14 lakh avg in 2019 ”: The Print, May 4, 2020.

[xiii] W.P.No.7419 of 2020: ( Dr.A.E. Chelliah vs. The Chairman and Members of the Bar Council of Tamil Nadu and Puducherry and an. )

[xiv] Bar Council Of Tamil Nadu & Puducherry: Press Release Dated 08-05-2020

[xv] Covid-19 Fallout: Pressure on hourly fee of top consultants, lawyers: The Economic Times, May 1, 2020

[xvi] “ After 180 cases from Arthur Road Jail, Maharashtra to release half the state’s prisoners ”: The Indian Express, May 12, 2020.

[xvii] Mainland China adds 573 coronavirus infections, eyes risks abroad: Reuters.com, March 1, 2020

[xviii] (1966) 3 SCR 744

[xix] “ ‘ Public hearing fundamental to democracy’: Lawyers on SC hearings via video conference ”, The Print, April 20, 2020.

[xx] The Law and The Lawyers By: M. K. Gandhi

[xxi] Pandemic or poison? How epidemics shaped Southasia's legal history by Mitra Sharafi: Himal Southasian, April 20, 2020.

[xxii] GD 353, 1918 GOB to District Magistrate, Bijapur, 13 November, 1918.

[taxlegit-blog]

Private Limited Company Registration in India

Private limited (PVT.LTD) company registration in India is the most successful business type in India. The business owners hold all shares of the company privately. Shareholders may operate the business themselves, or hire directors to manage the company on their behalf. Forming a (PVT.LTD) private limited company registration in India results in protection of personal assets, access to more resources, financial assistance and greater tax cuts.

Private limited company registration in India usually takes 10-15 days.

A (PVT.LTD) private limited company registration in India is a blend of corporate form of business structure and partnership. The most attractive feature of a private limited company registration in India is the Limited Liability of its members. It has the flexibility of a partnership firm and the advantages of a Company such as greater stability, better creditworthiness and separate legal entity. private limited company registration in India are an ideal way of starting and structuring startups with a higher scope of expansion as compared to partnerships as it is easy to raise capital from financial institutions due to its higher stability and reliability. More Details

Private Limited Company Registration in India: Documents Required & Online Procedure

In India, private limited companies have gained a lot of popularity since they have a simplified procedure of incorporation and low capital requirements. Other features that make private limited companies popular are - Limited liability of shareholders, ease in raising funds through issue of equity shares, separate legal entity, and perpetual existence. The average time to register the Private Company in India takes 10-15 days to vary depending upon the government processing time

Private Limited Companies and their registration are governed under the provisions of the Companies Act, 2013, Companies (Incorporation) Rules, 2014 and Ministry of Corporate Affairs (MCA).

 ● Scanned and self-attested copy of PAN and Aadhar Card of subscribers and directors.

●       Scanned copy of any one of the three Identity proofs of subscribers:

✔      Voter Id; or

✔     Passport; or

✔      Driving License

●       Scanned copy of any one of the three Address proof of subscribers:

✔     Electricity or Gas Bill (Not older than two months)

✔      Bank statement (Not older than two months)

✔      Mobile Bill (Not older than two months)

●       If the registered office premise is owned, scanned copy of address proof of registered office such as a mobile bill, electricity bill, gas bill, etc which should not be older than two months

●      Signed NOC from the landlord in case of the rented premise.

●       Scanned copy of notarized rent agreement

●       An affidavit from directors declaring that they have complied with the deposit rules of the Companies act.

●       Consent of the directors in Form DIR-2 to act as directors of the Company that contains the complete details of directors.

 Private Limited Company Registration | Insolvency application in NCLT for debt recovery | egal Notice | Cheque Bouncing Legal Notice | GST Return Filing & Registration | NBFC Registration | Virtual CFO | Debt Recovery Legal Notice | Insolvency NCLT Filing | GST Audit Support | Debt Recovery | private limited company registration process in india | pvt ltd company registration | one person company registration | pvt ltd company registration name availability | company registration in india | documents required for pvt ltd company | how to register a company name | private limited company rules

[corporate-lawyer]

How Can An Nri File Fraud Case Against Any Indian Company ?

The following article explains about different methods to resolve a dispute, the court proceedings, etc. in case a company or firm is suing or is being sued by an NRI.

An NRI may file a case in the court of relevant jurisdiction. Many states in India  have also constituted commercial courts which address disputes with transaction value of more than Rs 1 crore. 

Dispute Resolution Methods used in jurisdiction to resolve large commercial disputes-

In addition to the methods of Arbitration and Litigation, some other methods like Mediation or Conciliation can also be used before or during the proceedings to resolve a dispute.

Disputes with value of Rs 3,00,000 or more can also be heard by designated Commercial Courts under the Commercial Courts Act, 2015. These commercial disputes could be due to 

Financing transactions

Franchising

Import or export of goods or services

Admiralty or maritime law

IPRs

Joint venture or shareholder agreements

Almost all  huge commercial contracts have an arbitration clause, which provide for the preference of the parties to arbitration rather than a lengthy court case. In India, an arbitration proceeding should be completed within 12 months. 

Limitation Period in the proceedings of the court- 

Many claims under the contract are subjected to a limitation period of three years.

Courts addressing the contract disputes.

Civil court’s jurisdiction is determined by the value involved in the dispute i.e. the pecuniary jurisdiction and the territorial jurisdiction. 

Special tribunals have been provided with powers to deal with  issues of specific nature.

National Company Law Tribunal (NCLT) deals with the  disputes of the shareholder , cases of oppression and the mismanagement, other company related claims, etc.

Competition Commission of India- deals with the anti-trust or competition law disputes.

Debt Recovery Tribunal- deals with the proceedings related to debt recovery by the banks or certain financial institutions. 

Lawyers who have the right of audience to conduct cases in courts having jurisdiction over the large commercial disputes.

Lawyers enrolled with any of the State Bar Councils in India have the right of audience in the courts, tribunals and quasi-judicial bodies subject to some exceptions. 

Specialist tribunals also allow non-lawyers to represent their clients, for example NCLT allows the Company Secretaries, Chartered Accountants or cost accountants to conduct the cases. 

In addition parties could be represented by themselves in court proceedings, also the court may permit a person not enrolled as an advocate to appear before them as per the Advocates Act, 1961. It is, however, advised to seek the assistance of experienced Corporate Lawyers In Delhi or a Corporate Lawyers In Gurgaon or your city to represent you in the courts, as they will have a better understanding of the legal provisions involved. 

The Supreme Court in a recent judgement has ruled out the representation of foreign lawyers or law firms to offer legal service in the country on a permanent basis. They may offer advice in casual visits only which shall not amount to regular practice of law. 

A foreign lawyer could also be permitted to appear in India-seated arbitrations and shall be governed by the code of conduct applicable to Indian Lawyers.

Conclusion-

Any civil suit brought upon the company based in India, should be governed as per the provisions provided by the country. If there is a provision in the contract signed by the parties to sort out any dispute through the process of arbitration or court proceedings in a particular court, all you have to do is follow the procedure of respected law.

 Thus, the proceedings must remain the same. It is, thus, advised to seek the advice of experienced Corporate Lawyers In Noida, so as to have a better understanding of the legal procedures involved in your case.

Lead India offers you a team of experienced advocates who have been successfully dealing with various civil suits and can provide you with the required legal assistance or advice related to your case. Hence, if you wish to talk to a lawyer or seek free legal advice online, you may contact us.

SOURCE:-

Visit us: — https://www.leadindia.law

Call Us: +91–8800788535

Email: care@leadindia.law

YouTube: — https://www.youtube.com/c/LeadIndiaLawAssociates

Facebook: — https://www.facebook.com/leadindialaw

LinkedIn: — https://www.linkedin.com/company/76353439

Twitter: — https://twitter.com/leadindialaw

Pinterest: — https://in.pinterest.com/lawleadindia

Instagram: - https://www.instagram.com/leadindialawofficial

Corporate Lawyers In Delhi,Corporate Lawyers In Gurgaon,Corporate Lawyers In Noida

[realtybop]

Supertech Ltd. going to NCLT

The Possibility of Recovery and Property Claims in Supertech Ltd.

Supertech Limited, which is a Noida-based real estate company, has been declared insolvent by the National Company Law Tribunal (NCLT). The petition was raised by the Union Bank of India, which as a result has left almost 25,000 homebuyers in distress. As the company will go through insolvency proceedings, the chances are high that most homebuyers will have to wait a little longer to acquire their dream homes.

However, the petition that was made by the Union Bank of India also creates an opportunity to bring out better management to fully complete the pending projects. A new developer is also believed to be assigned for further developments, while the homebuyers also get the authority to completely take over their projects in case of emergency.

The following article would help to understand how Supertech assures absolute recovery and promises to deliver projects to several buyers.

Supertech Announcements on Their Projects

Supertech Ltd. stated that their preference was given more to construction and delivery of projects for home buyers, instead of prioritizing the repayment of bank dues. Furthermore, the company claimed that all the projects of the company are financially viable, thus it does not create any chances of loss to any party or financial creditor. Supertech has also mentioned that home buyers would be able to acquire their flats and homes within a very short period.

As the company has already delivered more than 40,000 flats in the last seven years, Supertech has promised to fulfill the target of providing 7,000 units by December 2022. The company also stated that the petition will not affect the operations of any other Supertech Group Company. With this, Supertech assured that the companies that are currently under their group such as ORB, Supernova, Golf Country, Hues, Azalia, Esquare, Basera would remain unaffected. The projects that are currently under construction and possessed by several homebuyers, would continue to move forward, even if the company is going through insolvency inspection.

Jaypee Infratech Insolvency Case

A similar case was also seen with Jaypee Infratech which went into the insolvency process in August 2017. After a complete analysis of the problems, Mumbai-based Suraksha Group was approved by financial creditors and helped homebuyers to recover the company in 2021. As a result, it raised the hopes of almost 20,000 home buyers to get possession of their properties. Therefore, the homebuyers who have taken possession and registered their property in Supertech Limited can expect the same recovery. Though, the chances are that the projects might take some time to get fully established.

What Should Homebuyers Do?

The recovery of Supertech Limited is expected soon, thus homebuyers should not panic about their properties. Firstly, it is advisable to file the claims with Corporate Insolvency Resolution Process (CIRP) and submit them to Corporate Insolvency Resolution Professional, Hitesh Goel, who has recently been appointed to NCLT.

Once this paperwork process is over, homebuyers will be eligible to claim over the properties that they bought from Supertech. With this, they will also become a part of the Committee of Creditors (COC). The role of the COC is to be an approval authority that manages all key decisions in Supertech. Although, the claims have to be submitted immediately and homebuyers should take an active part in CIRP to lead the company towards a resolution. As a result, both the homebuyers and the new developer would be able to contribute to reviving Supertech Limited.

[highcourtadvocateamedabad]

Best High Court Advocate in Ahmedabad, Gujarat

Pratik Thakkar Associates is top high court advocate in Ahmedabad, Gujarat.  He is specialist lawyer for matters likes Civil, Criminal, Insolvency & Bankruptcy, Corporate, Arbitration, NCLT (National Company Law Tribunal) Mergers and Acquisitions Lawyer, Labour Law, Trademark Matters, Patent, Mergers, Winding Up Matters, Liquidation, Auctions, Land Revenue Lawyer, Family Law, SAFEMA, Due Diligence for listing in stock exchange and Criminal Matters, he is the subject matter experts near me local area in Ahmedabad. 

He has completed his ILS Law College, University of Pune. Already Diploma in IPR & Cyber Law. Call to the Gujarat Bar Council in 2008.

Attorney Pratik Thakkar Associates, to ensure that your case is successful, you will need to hire a well-known and highly successful advocate. First, to make a reliable choice, you need to look for top lawyers or attorneys through high court advocate directory list in Ahmedabad, Gujarat. Relatives and friends who may have gone through legal discussing something in the past can provide you with the right solution at times. However, it is best to choose your lawyer based on your previous case study and success rate.

When you choose or hiring a lawyer to represent your case, make sure you are familiar with their style of work and are convinced beyond a shadow of a doubt that their representation can help you win your case. This can be done by contacting some of your previous customers and considering their services. The attorney's interaction with his client must be highly cooperative and compassionate. 

If you are looking for a top lawyer to win your case, it is actually more effective to get an advocate who has a very high number of cases wins. Those attorneys who have a large number of court victories know how to get the loopholes within the rule of law and therefore have a greater opportunity to win the case for you. Typically, advocates who advertise over 90 percent wins are attorneys who are likely to win your case. So select the perfect professional lawyer if possible!

 Pratik Thakkar is a lawyer is a highly professional and very deep knowledge of the law and who has experience and skill in representing clients in court and speaking directly to a judge and jury. If you are in court for any reason, or in a position where you want to take someone to court and file a complaint, resolve a divorce or terminate a contract, then you will need to make sure you have the best lawyer in Ahmedabad, Gujarat on your side.

 So, selecting, the best lawyers is a major investment that can help you from numerous points of view - whether it helps you get out of an uncomfortable agreement, whether it helps you improving your functioning conditions, whether it assists you keep your assets a divorce or if it helps you retain legal rights to your work or intellectual property. Regardless, you will save a lot of money and inconvenience and that means it is worth spending some time and money right now on hiring a decent lawyer in Ahmedabad.  

 While looking through online high court civil advocate in Ahmedabad, you should above and foremost look for lawyers that will manage specifically with your area of the law. If you are in legal debates with your bosses, then you will need to utilize a corporate lawyer counselor for example, and if you are going through divorce then you will advantage from divorce lawyers.

Pratik Thakkar is the best lawyer in Ahmedabad or Best NCLT Lawyer in Ahmedabad is getting tougher day by day. The good lawyer is one who knows what is Ethics and Values. I would really recommend Ethical Legal Consultants for the best legal services in Ahmedabad. Ethical and Legal.... Someone who has been through the legal system would have a fair knowledge of the fact that there is hardly any ethics left in it.

Address:

304,305, Hi-Scan House, B/s Mithakhali Under Bridge, Navrangpura, Ahmedabad - 380009 Mobile:+91 9725468686

Email:pratik.advocate@gmail.com

[vmls123]

Mediation for Operational Creditors: A New Dawn in India's Insolvency Framework

The Insolvency and Bankruptcy Board of India (IBBI) has put forward an innovative plan aimed at streamlining the resolution process for operational creditors (OCs). By allowing pre-institutional mediation before submitting insolvency applications under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016, the initiative seeks to promote early dispute resolution, lessen the load on adjudicating authorities, and speed up proceedings. While this concept holds great potential, its success will depend on how well it is implemented and the readiness of stakeholders to adapt to these changes. This development is particularly relevant for professionals and students pursuing an LLB degree course at a law university in Chennai or any of the best law colleges in India, as it represents a significant shift in insolvency law.

Mediation is increasingly seen as a quicker and less confrontational way to resolve disputes. It enables operational creditors and corporate debtors to have meaningful discussions with the help of a trained mediator. Rather than getting caught up in lengthy court battles, both parties can work together to tackle issues, which saves time, money, and effort. In addition to these practical advantages, mediation helps maintain important business relationships that could be damaged by litigation. For companies, collaborating to resolve disputes is much more advantageous than turning into opponents. The importance of this approach is highlighted by data showing that by April 2024, more than 21,000 Section 9 cases were settled before formal admission, while only around 3,800 progressed to full insolvency proceedings. This suggests that most disputes are resolved before they escalate into advanced litigation, emphasizing mediation's role as an effective pre-litigation strategy. Law students studying at the best private law colleges in India or aspiring for an LLB degree course can gain valuable insights from such mediation strategies in insolvency law.

Under the proposed framework, operational creditors can opt for mediation before filing their insolvency application. Disputes commonly revolve around payment delays, quality of goods or services, or contractual disagreements. A mediator appointed under the Mediation Act, 2023, will guide the discussions between the parties. If the mediation is successful, the dispute is resolved without involving the National Company Law Tribunal (NCLT). However, in case of failure, the mediator will issue a non-settlement report, which the creditor can annex to the insolvency application when initiating formal proceedings. This approach balances the need for efficiency with the flexibility to pursue formal insolvency resolution if required. The growing emphasis on mediation in India's legal system makes it a crucial area of study for students enrolled in a law college or one of the best colleges for law in the country.

While the benefits of this initiative are apparent, challenges remain. Mediation is voluntary, which means its success depends on the willingness of both parties to participate in good faith. There is also the risk that corporate debtors may exploit mediation as a stalling tactic to delay creditors’ access to formal proceedings. For smaller creditors, the lack of bargaining power could pose additional challenges, particularly when negotiating with larger and more resourceful corporate debtors. Furthermore, the enforcement of mediation outcomes relies on voluntary compliance, and any breach of the agreement could force creditors back into lengthy legal battles, defeating the purpose of the initiative. The practical challenges associated with mediation are an important area of legal study, making it an essential topic for those pursuing an LLB degree course at a law university in Chennai or any of the best law colleges in India.

Despite these concerns, the potential for pre-institutional mediation to reshape India’s insolvency framework is significant. To ensure its success, several measures must be implemented. These include developing a strong pool of trained mediators, increasing awareness among creditors and debtors about the advantages of mediation, and offering support mechanisms such as legal aid for smaller creditors to create a more equitable environment. Furthermore, establishing transparent monitoring systems to track mediation outcomes can promote accountability and enhance the process over time. As alternative dispute resolution methods gain traction, legal education institutions, including the best private law colleges in India, are integrating these concepts into their curricula to prepare future legal professionals.

If executed properly, pre-institutional mediation could serve as a fundamental element of India’s insolvency framework. It provides operational creditors with a faster, more cost-effective method to recover their dues while alleviating the burden on an overloaded judiciary. By encouraging a culture of dialogue and cooperation, this initiative has the potential to foster a more efficient and balanced insolvency ecosystem that benefits all parties involved. For operational creditors, it is not just a means of resolving disputes but also a move towards establishing a fairer and more streamlined process for achieving justice. Law students and professionals from the best colleges for law can look forward to new opportunities in insolvency law and mediation, further expanding their career prospects.

[renukamd]

How to Legally Close Your LLP in Chennai: A Complete Process Overview

Introduction

Closing a Limited Liability Partnership (LLP) in Chennai involves legal formalities and regulatory compliance to ensure a smooth dissolution process. Whether the LLP is inactive, unable to continue its business, or facing financial difficulties, following the correct procedure is essential to avoid penalties and liabilities.

Modes of Closure of LLP

An LLP can be closed using the following methods:

1. Voluntary Closure through Form 24

This is the most common method for closing an LLP when it is not carrying on any business activity.

Eligibility Criteria:

The LLP must not have carried out any business operations for at least one year.

There must be no pending liabilities, dues, or legal proceedings.

Consent from all partners is required.

Procedure for Voluntary Closure:

Cease Business Operations: Ensure the LLP has not conducted business for at least one year.

Obtain Partner’s Consent: All designated partners must agree to dissolve the LLP.

Explicit Liabilities: Settle all outstanding debts, taxes, and liabilities.

Prepare Documents:

A statement of accounts showing no assets or liabilities (not older than 30 days).

An affidavit from all partners stating that the LLP has no liabilities.

A copy of the latest Income Tax Return (if applicable).

Filing of Form 24: Submit Form 24 along with the required documents to the Registrar of Companies (ROC).

Approval by ROC: Upon verification, the ROC will issue a notice confirming the dissolution of the LLP.

2. Strike Off by ROC (Registrar of Companies)

The ROC may initiate the closure of an LLP if it is found to be inactive and non-compliant.

Conditions for Strike Off:

The LLP has not filed financial statements or annual returns for two consecutive years.

The LLP has not commenced business since incorporation.

There are no pending legal cases or liabilities.

Process:

The ROC will send a notice to the LLP and its partners.

If no response is received within the stipulated time, the LLP will be struck off from the records.

3. Closure through the Insolvency & Bankruptcy Code (IBC)

If the LLP is unable to pay its debts, it may undergo liquidation under the Insolvency & Bankruptcy Code (IBC).

Process:

Applying to the National Company Law Tribunal (NCLT).

Appointing a liquidator to manage the dissolution process.

Distribution of assets to creditors.

Final closure by the tribunal.

Documents Required for LLP Closure

PAN card and Aadhaar card of partners.

LLP agreement.

Affidavits and declarations from partners.

Consent letters from all partners.

Statement of accounts.

Income Tax Return acknowledgement (if applicable).

No-objection certificate (NOC) from creditors (if any).

Estimated Timeline and Cost

Timeline: The entire closure process can take 3 to 6 months, depending on regulatory approvals.

Cost: The government fees and professional charges may range from ₹5,000 to ₹15,000, depending on the complexity.

Conclusion

Adhering to legal procedures to close an LLP in Chennai ensures a hassle-free exit. Choosing the correct method based on the LLP’s status can help partners avoid future complications. Seeking professional assistance from legal experts can ensure compliance with the necessary regulations.

[kanakkupillai-trademark]

How to Close a Limited Liability Partnership: A Step-by-Step Guide

Closure of Limited Liability Partnership (LLP)

A Limited Liability Partnership (LLP) is a famous business structure that provides its partners with a blend of operational flexibility and limited liability protection. However, due to various reasons, such as unprofitability, changes in business plans, or any other reason, partners might want to close an LLP. Closing an LLP involves legal procedures that ensure the business is officially dissolved and ceases to exist in the eyes of the law.

Methods of Closing an LLP

There are two primary ways to close an LLP in India:

Voluntary Closure (Strike Off)

Compulsory Closure

1. Voluntary Closure (Strike Off)

In a voluntary closure, the partners of the LLP decide to close the business due to reasons like non-operation, no future business plans, or any other reason. This method is generally applicable when the LLP has no liabilities or pending debts. The closure is done by applying for striking off the LLP's name from the register of companies maintained by the Registrar of Companies (RoC).

Critical Steps in Voluntary Closure:

Consent of Partners:

All partners must pass a resolution for voluntary closure.

In the case of a pending liability, the LLP must settle all debts or provide security for them before applying for closure.

Filing Form 24:

The LLP must file Form 24 with the RoC to initiate the closure process. The form includes details about the LLP, the reason for closure, and a declaration of non-operation for at least one year (if applicable).

Affidavit & Indemnity Bond:

All designated partners need to submit an affidavit declaring that the LLP has no liabilities.

An indemnity bond must be filed to assure that the partners will bear any future claims or liabilities.

Submission of Documents:

Statement of accounts (not older than 30 days)

LLP agreement

Consent letters from all partners

Approval from RoC:

The Registrar will review the documents and, if satisfied, approve the striking off of the LLP’s name. Once the name is removed from the register, the LLP is officially dissolved.

2. Compulsory Closure

In some cases, the closure of an LLP is enforced by law or by an order from the court. This method is referred to as compulsory closure and usually occurs when:

The LLP is unable to pay its debts.

The LLP is involved in fraudulent activities.

The LLP only does business for two years or more after filing annual returns.

In such cases, the National Company Law Tribunal (NCLT) or the court may order the LLP's winding up, following which the LLP's assets are liquidated and the creditors are paid off.

Process of Compulsory Winding Up:

Filing Petition:

A petition for compulsory winding up can be filed by the LLP, creditors, or the RoC.

Appointment of Liquidator:

Upon the order of the NCLT, a liquidator is appointed to oversee the winding-up process, including liquidating assets and settlement of liabilities.

Settlement of Debts:

The liquidator settles all outstanding debts, sells off assets, and distributes any remaining funds among partners, if applicable.

Final Report and Dissolution:

The liquidator submits a final report to the tribunal, which, upon satisfaction, passes a dissolution order. The LLP ceases to exist after the order is passed.

Critical Considerations for LLP Closure

Pending Compliances:

Before closing the LLP, ensure that all statutory filings, such as annual returns, income tax returns, and GST returns (if applicable), are completed.

No Liabilities:

For voluntary closure, the LLP must not have any outstanding liabilities or debts. If any exist, they must be settled before filing for closure.

Non-Operative LLP:

The LLP should be non-operational for at least one year before applying for voluntary closure, or it should not have commenced business at all.

Tax Clearance:

Obtain tax clearance from the Income Tax Department before initiating closure, especially if the LLP has been operational.

Costs Involved:

Although the cost of voluntary closure is minimal, there are still administrative costs and fees associated with filing forms and professional fees (if required).

Conclusion

Closing an LLP is a formal legal process that requires careful attention to detail, especially in ensuring that all liabilities are cleared and statutory compliances are met. For partners looking to shut down their LLP, opting for a voluntary closure is a smoother process if the LLP is debt-free and has been non-operational. However, compulsory winding up is a court-supervised process that generally involves asset liquidation and settling of creditors.

[vignaniasacademy]

Daily Current Affairs - News Analysis

Virus-hit Wuhan locked down

Trains and planes indefinitely suspended; travel curbs in neighbouring cities too.

-China on Thursday locked down some 20 million people at the epicentre of new coronavirus outbreak,banning planes and trains from leaving in an unprecedented move aimed at containing the disease. -It has claimed 17 lives and infected hundreds. About Coronavirus:                                                   Coronaviruses (CoV) are a large family of viruses that cause illness ranging from the common cold to more severe diseases such as Middle East Respiratory Syndrome (MERS-CoV) and Severe Acute Respiratory Syndrome (SARS-CoV).Coronaviruses are zoonotic, meaning they are transmitted between animals and people. Symptoms: Common signs of infection include respiratory symptoms, fever, cough, shortness of breath and breathing difficulties. In more severe cases, infection can cause pneumonia, severe acute respiratory syndrome, kidney failure and even death. Transmission: Human coronaviruses most commonly spread from an infected person to others through: the air by coughing and sneezing.close personal contact, such as touching or shaking hands.touching an object or surface with the virus on it, then touching your mouth, nose, or eyes before washing your hands.rarely, fecal contamination.

The condemned can’t fight endlessly, says CJI-

 “It was important for capital punishment to reach its finality” In the context of Nirbhaya case death convicts. -Recently government made an application to Supreme court to set short deadlines for death row convicts to seek legal remedies. -It wanted the court to limit the time for filing curative petitions. -A mercy plea should be filed within a week of issuance of death warrant. -If mercy plea is rejected, death warrant should be issued within next 7 days and the execution carried out a week thereafter. India again rejects Trump offer on Kashmir issue- Hence ruled out any role for a “third party” in Kashmir issue, clarifies the MEA spokesperson. India slips 2 places on Corruption perception index 2019- Ranks 80th with a score of 41/100 among 180 countries (2018- 78th rank)(Denmark tops-Score-87). Below the global average of 43 mainly because of “unfair and opaque political financing ”,” undue influence in decision making”,”lobbying by powerful corporate interest groups. Released by Transparency International. No coercive action for missing AGR date-Telecom Department. AGR-Adjusted Gross Revenue (AGR) is the usage and licensing fee that telecom operators are charged by the Department of Telecommunications (DoT). It is divided into spectrum usage charges and licensing fees, pegged between 3-5 percent and 8 percent respectively. How is it calculated and what’s the contention? As per DoT, the charges are calculated based on all revenues earned by a telco – including non-telecom related sources such as deposit interests and asset sales. Telcos, on their part, insist that AGR should comprise only the revenues generated from telecom services. What’s the issue now? In 2005, the Cellular Operators Association of India (COAI) challenged the government’s definition for AGR calculation.Later in 2015, the TDSAT said AGR included all receipts except capital receipts and revenue from non-core sources such as rent, profit on the sale of fixed assets, dividend, interest and miscellaneous income, etc.The regulator has also included forex adjustment under AGR apart from ruling that licenses fee will not be charged twice on the same income. It, however, exempted bad debt, foreign exchange fluctuations, and sale of scrap to be calculated for AGR.The government has also raised the issue of under-reporting of revenues to duck charges. The Comptroller and Auditor General of India (CAG) called out telcos for understating revenues to the tune of Rs 61,064.5 crore.The Supreme Court has upheld the definition of Adjusted Gross Revenue (AGR) calculation as stipulated by the Department of Telecommunications. This means that telecom companies will have to pay up as much as Rs 92,642 crore to the government. ICJ orders Myanmar to protect Rohingya- -It ordered Myanmar to take immediate measures to protect them from genocide and report back within 4 months. -A lawsuit launched by Gambia in November at ICJ for disputes between states accuses Myanmar of genocide against Rohingya in violation of a 1948 Genocide convention. Rohingyas- The Rohingya people are a stateless Indo-Aryan ethnic group who predominantly follow Islam with a minority following Hinduism and reside in Rakhine State, Myanmar . More than 7,30,000 rohingyas fled Myanmar after a military-led crackdown in 2017. ICJ-The International Court of Justice (ICJ) is the principal judicial body of the UN. Established in 1946 to replace the Permanent Court of International Justice, the ICJ mainly operates under the statute of its predecessor, which is included in the UN Charter. It has two primary functions: to settle legal disputes submitted by States in accordance with established international laws, and to act as an advisory board on issues submitted to it by authorized international organizations. Nepal invites Modi , Imran for Sagarmatha dialogue.- Sagarmatha Sambaad/dialogue is a multi-stakeholder, permanent global dialogue forum initiated by the Government of Nepal. It is scheduled to be held biennially in Nepal. Rising CO2 levels may double floods,storms-  Risk of extreme floods could double every 13 years, say scientists. Karnataka government notifies “Karnataka Prevention and eradication of inhuman evil practices and black magic act.” -Law bans made snana(rolling over on parttaken food of others), coercing to perform firewalk, causing physical injury, baibiga practice(piercing rods), pelting stoned in the name of banamati and matamantra on residential houses. Bharatanatyam Costumes- 3 types 1] Skirt costume - that resembles half sari. 2] Sari costume - that looks like kachche sari. 3] Pyjama costume – that has intricate and permanently pressed frills(widely used). Aharya -  the abhinaya through costume, jewellery and make-up, enhances look and mood for the performance. A classical dance form that encompasses Bhav, Rag, Ras and Taal is ‘Bharatanatyam’. Bha: Bhava which means emotionsRa: Rag meaning musical notes.Ta: Taal meaning the Rhythm.Natyam: The Sanskrit word for Drama.  (others classical dance forms- kathakali, mohiniyattam, sattriya odissi, Manipuri, Kathak, Kuchipudi ) Editorial analysis Needless impatience- -Nothing will be lost if death row convicts are allowed to exhaust all remedies. -Condemns the centre’s application in SC for additional guidelines regarding execution of condemned prisoners. -Present Guidelines laid down in Shatrughan Chauhan Case which are considered to be “accused-centric”. - 14 day time lag between the closure of clemency/mercy route their hanging is aimed at preventing secret executions. -To believe that these are matters that contribute to substantial delay is misconceived. -However there is no more than a few days delay. Budgeting for jobs, skilling and economic revival- -The budget needs to provide direction to India’s tottering economy and a boost to aggregate demand and investment. -Future of country’s youth depends on this budget. -Unemployment rate is at 45-year high at 6.1%(2017-18)(urban youth-22.5% for 15-29 aged). -Periodic labour force survey-LFPR come down to 46.5%.(37.5%-urban youth). -“Employment poverty” due to low wages. -Ongoing slowdown main reason. -Aggregate investment is less than 30% of GDP. -Schemes like PM-KISAN and MGNREGA can boost rural demand immediately because farmers and landless labourers spend most of their income. -Rural unemployment can be reduced by raising budgetary allocation for irrigation projects rural infrastructure like roads,cold storage and logistical chains. -In urban areas construction is major of employment but many real-estate projects are caught up in legal disputes with multiple authorities having jurisdiction(RERA,NCLT). -Hence focus should be on projects under implementation rather than new projects. -Tax exemption on home loans is a remedy. -20,000 crore gets stuck with government annually in form of Input Tax credits , hence increasing cost of business of SMEs. As India prepares to honour Bolsonaro- -Focus should be on intra-BRICS p’ship and trade. -Each country has different economic and political leverage,and its own burden of domestic external issues. -Group’s informal structure is an advantage for coordination. -The BRICS group can survive only if its members maximise their congruences to the extent possible, despite the growing intensity of Sino-Russian ties; the pro-American leanings in Brazil; the socio-economic difficulties of South Africa after nine years under the controversial Jacob Zuma; and India’s many difficulties with China, including its abstention from the Regional Comprehensive Economic Partnership. -Main achievement of BRICS is the New Development Bank, with each country contributing equally to its equity. -They are also developing a joint payments mechanism to reduce foreign trade settlements in U.S. dollars. -An offshoot of the group, dealing with climate change, is BASIC (BRICS without Russia), which met at the Spain conference last month and reiterated its support to the Paris Agreement. -Could justify his invitation to Mr. Bolsonaro with references to the enduring quality of BRICS, Brazil’s agreement to waive visa requirements for Indian citizens, and the potential for Brazilian investments in the sectors of space and defence, agricultural equipment, animal husbandry, post-harvest technologies, and bio-fuels. Will Budget suspend the FRBM(Fiscal responsibility and budget management act)’s fiscal deficit goals? -Any fiscal review needs to ideally redirect spending priorities to capital from consumption. -In principle,FRBM is basically an expenditure switching mechanism from consumption to capital, but we are actually seeing the opposite. -Hence revisit the FRBM act ,revert to the original FRBM, try to focus more on the revenue deficit. -Nominal GDP growth is 7.5% lowest in last 42 years, hence clearly an evidence of lack of demand. -We need to give high priority to for recapitalization wherever necessary, isolating bad assets and let credit grow at 15-20%. -Also don’t let go off revenue sources. -This year its better to take refuge in some of escape clauses instead of fiscal deficit control and wait for growth revival next year. The origin of the constitution- -The history of constitution stretches to over 40 years before its enactment. -Founding document of the Indian Republic is believed to have been completed solely by the Constituent Assembly, working flat out in just two years, eleven months and 17 days. - In fact, the Constitution’s long history stretches to over 40 years before its enactment, going all the way back to the Indian Councils Act of 1909. -This law, for the first time, brought Indians into governance at central and provincial levels, albeit in a very limited way, through a highly restricted and unrepresentative electorate split on communal lines. - The Government of India Act, 1919 was a vast improvement on the Indian Councils Act but remained unrepresentative. -In its report submitted in 1930, the Simon Commission, constituted to evaluate the Government of India Act of 1919, recommended much greater Indian involvement in the governance of the country. -What followed its report were three extraordinary roundtable conferences — in 1930, 1931 and 1932 — all held in London to see how best Indians could administer their country. -They were remarkable for discussing, debating and comprehensively documenting a range of issues — federalism, civil services, regional representation, fundamental rights and universal adult franchise. -Even the idea of linguistic states and reservation emerged from the discussions at the three roundtable conferences. -Led to the passage of the Government of India Act of 1935, much of which found its way into the Constitution. 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The latest government data shows that how IBC is a huge change brought by the recent government in terms of a speedy redressal for the aggrieved homebuyers.