IBC Does Not Prohibit An Assignee From Continuing Pending Section 7 Proceedings: NCLAT Delhi
Posted On : December 15, 2022
The National Company Law Appellate Tribunal ("NCLAT"), while adjudicating an appeal filed in Siti Networks Ltd. v Assets Care and Reconstruction Enterprises Ltd. & Anr., has held that there is no prohibition in the IBC or any of the Regulations from continuing the proceeding by an assignee. Section 5(7) of the IBC which defines 'Financial Creditor' also includes a person to whom such debt has been legally assigned or transferred to. By virtue of assignment, an assignee becomes the Financial Creditor and it has every right to continue the proceeding which was initiated by the original Financial Creditor/Assignor.