The NCLAT held that the Prospective Resolution Applicant, having actively participated In CIRP, has locus standi to file an Intervention Application.
The National Company Law Appellate Tribunal (NCLAT), Principal Bench comprising Justice Ashok Bhushan (Chairperson) and Barun Mitra and Arun Baroka (Technical Members) was hearing an appeal and observed that a Prospective Resolution Applicant, having actively participated in the CIRP and contesting the approval of a competing offer, possessed the requisite locus standi, to file an intervention application. The Appellate Tribunal observed that the appellant's objections required consideration, indicating their involvement in the matter.
The National Company Law Appellate Tribunal (NCLAT) adjudicated on an appeal challenging the rejection of an intervention application by the National Company Law Tribunal (NCLT), Mumbai Bench, Court-II. The appellant, PRI0 S.A., filed the appeal against the order dated 09.10.2023, which dismissed their intervention application (IA No. 3363 of 2023) in IA No. 2787 of 2023.
The background facts revealed that PRI0 S.A. had participated in the corporate insolvency resolution process (CIRP) of a corporate debtor. They submitted three successive offers following an invitation for submission of expression of interest (EOI) and negotiation with the resolution professional (RP) and the Committee of Creditors (CoC). However, their third offer was not responded to by the RP. Subsequently, the RP filed an application for the approval of an offer from Respondent No. 2.
PRI0 S.A. filed IA No. 3363 of 2023 seeking intervention, which was rejected by the NCLT on grounds of lack of locus standi. The appellant argued that they had a legitimate interest in the proceedings due to their participation in the negotiation process and their objections to the approval of Respondent No. 2's offer.
The NCLAT, after hearing all parties, found that PRI0 S.A. indeed had locus standi to file the intervention application. The tribunal observed that the appellant's objections required consideration, indicating their involvement in the matter. Hence, the NCLAT set aside the NCLT's order and allowed PRI0 S.A. to file objections to IA No. 2787 of 2023.
The NCLAT's decision emphasized that its ruling did not express any opinion on the merits of the parties' contentions, leaving it to the NCLT to decide the issues afresh in accordance with the law.
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