The NCLAT has ruled that APDCL must pay ₹37.66 lakh with interest to the liquidator of Brahmaputra Rolling Mills, highlighting the distinct legal status of companies under the IBC. The tribunal rejected the set-off plea based on mutual dealings.
NCLAT Orders APDCL to Pay Liquidator ₹37.66 Lakh
The National Company Law Appellate Tribunal (NCLAT) has directed the Assam Power Distribution Company Limited (APDCL) to pay ₹37.66 lakh along with interest to the liquidator of Brahmaputra Rolling Mills. The NCLAT's decision underscores the legal principle that each company is regarded as a separate legal entity under the Insolvency and Bankruptcy Code (IBC).
The tribunal rejected APDCL's plea for set-off, asserting that such provisions apply only to mutual dealings between the same parties. This ruling reinforces the significance of treating different corporate entities as distinct under the IBC, ensuring that obligations remain enforceable regardless of informal arrangements.
By clarifying the limits of set-off claims, the NCLAT contributes to a more robust framework for insolvency proceedings, mitigating potential disputes relating to inter-company transactions. The decision aligns with established legal principles that govern financial relationships, particularly in insolvency contexts.
This ruling serves as a vital reference for practitioners, emphasizing the importance of precise inter-company dealings and the rigorous application of the IBC in liquidations. It underscores the significance of financial accountability between creditors and debtors in insolvency situations.
Citations
- NCLAT (2026) NCLAT Order 2
