The Insolvency and Bankruptcy Board of India has approached the Supreme Court seeking clarity on its prosecution powers, over a month after the National Company Law Appellate Tribunal declined to extend the insolvency period for Amtek Auto Ltd.
The IBBI, represented by Additional Solicitor General of India Madhavi Divan, has challenged a portion of NCLAT's order in the Amtek Auto case, which held that the bankruptcy board can initiate prosecution only in cases that are referred to it by the National Company Law Tribunal or the central government.
A Supreme Court bench, headed by Justice Arun Mishra, also put on hold Monday the criminal prosecution initiated against Liberty House Group, which had successfully bid for Amtek Auto during the latter's insolvency process, only to later back out citing irregularities in information shared with them.
Liberty House was represented by Senior Advocate Mukul Rohatgi, who sought to stay the prosecution against the U.K.-based business group.
The NCLAT had in August declined to extend the 270-day insolvency period for the resolution process of Amtek Auto, which set the stage for liquidation of the debt-ridden auto components maker. The NCLAT order for liquidation has been challenged at the Supreme Court, which has stayed the process.
The top court will hear the Amtek Auto case and the bankruptcy board's petition on Tuesday.
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