The National Company Law Appellate Tribunal (NCLAT) Chennai has allowed the appeal filed by the Coffee Day Enterprises Limited (CDEL) and set aside the proceedings of Corporate Insolvency Resolution Process (CIRP) initiated against the Company as per the National Company Law Tribunal (NCLT) Bangalore.
The matter stems out from IDBI Trusteeship Limited (ITSL) filing the insolvency petition against CDEL in September 2023 claiming that the latter had defaulted on a payment of over ₹228 crore on four occasions between 2019 and 2020 related to a Debenture Trust Deed in 2019.
The NCLAT order admitting insolvency plea was put on hold after Malavika Hegde, a director in the company, moved the appellate tribunal challenging the NCLT order contending that ITSL had no power to ask for CIRP under Section 7 of the Insolvency and Bankruptcy Code (IBC), since it was not a financial creditor.
