IBC | Section 12A Application Not Mandatory If No Other Creditors Are Involved & Settlement Is Reached: NCLAT New Delhi

The NCLAT (National Company Law Appellate Tribunal), New Delhi, held that a Section 12A application under the IBC (Insolvency and Bankruptcy Code) for withdrawal of the insolvency process is not mandatory if no other creditor exists and a settlement is reached with the sole creditor. Section 12A allows for withdrawal with the approval of the Committee of Creditors. The NCLAT's ruling provides an exception in cases with only one creditor where a settlement obviates the need for CoC approval.