During the second e-auction of the mortgaged assets of the respondent, three persons became successful bidders by jointly offering a price of ₹32.92 crore for both the secured assets. On December 13, 2018, the sale was confirmed in the favour of the successful bidders.
While the auction process was ongoing, the respondent had filed a petition under Section 10 of the Code before the National Company Law Tribunal (NCLT) at Hyderabad to initiate the CIRP. In January 2019, the NCLT admitted the Section 10 petition, and consequently, the CIRP was initiated.
A moratorium as provided under Section 14 of the IBC was notified and an Interim Resolution Professional (IRP) was also appointed. Before the NCLT, IOB claiming that since it had not received 75% of the bid amount from the successful bidders, it was not excluded from the claim filed before the IRP.
Subsequently, an application was filed by the respondent company urging the NCLT to set aside the security realization carried out by IOB during the CIRP period, or in the alternative, to cancel the transaction. The NCLT allowed the same, prompting the bank to approach the NCLAT in appeal. After the Appellate Tribunal rejected the appeal in March 2021, IOB moved the Supreme Court.
Source: Barandbench
