The National Company Law Tribunal (NCLT) Chandigarh Bench held that mere suspicion and unsubstantiated assertions cannot establish fraudulent initiation of Corporate Insolvency Resolution Process (CIRP) under Section 65 of the Insolvency and Bankruptcy Code, 2016 (IBC) and rejected plea of director.
The application was filed by Dr. Vijay Vohra, a director and shareholder of A.P.J. Laboratories Ltd. challenging the Section 7 insolvency petition initiated by Himalaya Food International Ltd. against the company. The applicant alleged that the financial creditor had engineered the debt through collusive transactions and common management, with the objective of triggering insolvency proceedings for purposes other than…