The National Company Law Appellate Tribunal (NCLAT) Principal Bench at New Delhi, has upheld the admission of a Section 7 application under the Insolvency and Bankruptcy Code, 2016, holding that a financial default which crystallised prior to 25 March, 2020, is not protected by the statutory bar under Section 10A, even where the underlying loan documents provided a contractual cure period.
The Tribunal clarified that once a default occurs and the cure period expires without full payment, subsequent payments or lender conduct cannot retrospectively erase the fact of default.
The appeal arose from an order of the NationalCompany Law Tribunal admitting a Section 7 petition and initiating the corporate insolvency…