InfoAlert - Termination of PPA under the IBC, 2016

Published On: 23/04/2021

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The Hon’ble Supreme Court of India (“Supreme Court”), on March 8, 2021, in the matter of Gujarat Urja Vikas Nigam Limited Vs. Mr. Amit Gupta & Ors (“GUVNL Case”), stayed termination of a Power Purchase Agreement (“PPA”) executed between a corporate debtor i.e., Astonfield Solar (Gujarat) Private Limited (“ASGPL”) and Gujarat Urja Vikas Nigam Limited (“GUVNL”), for which Corporate Insolvency Resolution Process (“CIRP”) had been initiated. The instant appeal before the Supreme Court as a result of the judgment dated October 15, 2019, passed by the National Company Law Appellate Tribunal (“NCLAT”) whereby the judgment dated August 29, 2019, passed by the National Company Law Tribunal (“NCLT”) was upheld. The NCLT’s judgment was passed pursuant to an application under Section 60(5) by Resolution Professional (“RP”) of the Insolvency Bankruptcy Code, 2016 (“IBC/Code”). In its landmark ruling, the Supreme Court held that the NCLT has jurisdiction to adjudicate disputes, which arise solely from or which relate to the insolvency of the corporate debtor.