Case Note & Summary
The appeal arose from an order dated 27.05.2025 by the National Company Law Tribunal (NCLT), Guwahati Bench, directing the Appellant, Assam Power Distribution Company Ltd., to pay ₹ 37,66,906.80 to the Liquidator of Brahmaputra Rolling Mills Pvt. Ltd. The Appellant contended that the same group of companies owed it ₹ 9,07,03,124, arguing that the Corporate Debtor should be treated as part of a single economic entity under the Group of Companies Doctrine. The Respondent, acting as Liquidator, maintained that the Appellant had admitted its liability and failed to pay despite multiple reminders. The NCLT had previously initiated a Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor on 18.11.2022, followed by a liquidation order on 13.10.2023. The Appellant's claims for set-off were rejected on the grounds that the Corporate Debtor and other group entities were separate legal entities, each undergoing distinct liquidation processes. The court emphasized that the principle of set-off under Regulation 29 of the Liquidation Process Regulations applies only to mutual dealings between the same parties, which was not the case here. The appeal was ultimately dismissed, affirming the NCLT's order and the Appellant's liability to pay the outstanding dues.
Headnote
A) Insolvency Law - Liability of Operational Creditor - Outstanding Dues - Insolvency and Bankruptcy Code, 2016, Section 60(5) - The Appellant was directed to pay outstanding dues of ₹ 37,66,906.80 to the Liquidator despite claims against other group entities, as the Corporate Debtor is a separate legal entity. The court held that the Appellant's argument for set-off based on group identity was not tenable under the law (Paras 30-41).
Issue of Consideration
Whether the Appellant is liable to pay the outstanding dues to the Respondent despite the applicability of the Group of Companies Doctrine and Regulation 29 of the Liquidation Process Regulations.
Final Decision
The appeal was dismissed, affirming the NCLT's order directing the Appellant to pay ₹ 37,66,906.80 along with applicable interest from 31.12.2014 to the Liquidator of Brahmaputra Rolling Mills Pvt. Ltd.
Law Points
- Insolvency and Bankruptcy Code
- 2016
- set-off
- mutual dealings
- separate legal entities
- liquidation process regulations
