Introduction:

In the case of Piramal Enterprises Ltd. v. Kay Jay Leasing , the National Company Law Tribunal (NCLT), New Delhi Bench, delivered a significant ruling regarding the amendment of pleadings, specifically the date of default, in a Corporate Insolvency Resolution Process (CIRP) application filed under Section 7 of the Insolvency and Bankruptcy Code (IBC). The Applicant, PHL Fininvest Pvt. Ltd., sought rectification of the date of default mentioned in the application, which was allowed by the Tribunal. The verdict highlighted the permissibility of amending pleadings at any stage of the matter under Section 7 of the IBC.

Arguments of Both Sides:  

Representing the Applicant, Mr. Krishnendu Datta, Sr. Adv., argued that the defaults by the Corporate Debtor were continuous in nature, with one instance occurring on 30.09.2020. The Applicant sought rectification of this date, contending that subsequent defaults occurred even after the mentioned date.

On behalf of the Corporate Debtor, Mr. Vikas Dutta, Adv., contested the Applicant’s plea for amendment, aiming to dismiss the Company Petition under Section 10A of the IBC, 2016, and argued against rectifying the date of default.

Court’s Judgement:  

The NCLT, New Delhi, allowed the Applicant’s plea for amending the date of default mentioned in the Section 7 application. It upheld the permissibility of amending pleadings, including rectification of the date of default, at any stage of the proceedings.

The Tribunal noted the continuous nature of defaults by the Corporate Debtor, highlighting the obligations under the Loan Agreement, with default consequences arising from non-payment of interest and principal as per the Facility Agreement’s stipulated timelines.

Consequently, the NCLT allowed the amendment, modifying the date of default to 05.04.2021 as requested by the Applicant. The ruling reiterated the settled principle that amendments to pleadings in an application under Section 7 of the IBC can be made at any stage of the proceedings.