Property In Possession Of Corporate Debtor Sold When Petition U/S 7 Of IBC Was In Consideration Cannot Be Excluded From Assets: NCLAT

The NCLAT has ruled that property in possession of a corporate debtor, sold during a petition under Section 7 of the IBC, cannot be excluded from the debtor’s assets. This decision emphasizes that such sales should be considered part of the insolvency resolution process. The tribunal clarified that assets sold during these proceedings are integral to the overall resolution and cannot be separately disposed of. This ruling ensures the integrity of the corporate debtor’s asset pool during insolvency, prioritizing the interests of creditors within the framework of the IBC. It underscores the critical nature of maintaining asset continuity in insolvency proceedings.