The much awaited legal challenge to the recent Insolvency Ordinance is now underway in the form of a Writ petition, before the Punjab and Haryana High Court, triggered by RMS Pvt. Ltd..Last week, the Government adopted the Ordinance route to bar promoters who have defaulted on loans and interests, whose accounts have been classified as non-performing assets and wilful defaulters. The Ordinance essentially bars Promoters from bidding for their assets until they clear their dues..The Ordinance has been challenged on primarily two grounds:.Retro-activity of the ordinance.It does not distinguish between a genuine promoter and a wilful defaulter.Accordingly, RMS has prayed for the issuance of a Writ in the nature of Certiorari, quashing the operation of paragraph 5 of the Ordinance (inserting Section 29A into IBC), paragraph 6 of the Ordinance (amending Section 30 of the IBC) and paragraph 7 of the Ordinance (amending Section 35 the IBC) and declaring the above mentioned paragraphs as unconstitutional and ultra vires..The Punjab and Haryana High Court has issued a notice to the government and posted the matter for hearing in January..Petitioner was represented by a team led by Pooja Mahajan of Chandhiok & Associates.
The much awaited legal challenge to the recent Insolvency Ordinance is now underway in the form of a Writ petition, before the Punjab and Haryana High Court, triggered by RMS Pvt. Ltd..Last week, the Government adopted the Ordinance route to bar promoters who have defaulted on loans and interests, whose accounts have been classified as non-performing assets and wilful defaulters. The Ordinance essentially bars Promoters from bidding for their assets until they clear their dues..The Ordinance has been challenged on primarily two grounds:.Retro-activity of the ordinance.It does not distinguish between a genuine promoter and a wilful defaulter.Accordingly, RMS has prayed for the issuance of a Writ in the nature of Certiorari, quashing the operation of paragraph 5 of the Ordinance (inserting Section 29A into IBC), paragraph 6 of the Ordinance (amending Section 30 of the IBC) and paragraph 7 of the Ordinance (amending Section 35 the IBC) and declaring the above mentioned paragraphs as unconstitutional and ultra vires..The Punjab and Haryana High Court has issued a notice to the government and posted the matter for hearing in January..Petitioner was represented by a team led by Pooja Mahajan of Chandhiok & Associates.