Latest NCLAT Judgment 2025| CIRP is a Proceeding in Rem | Kriti Prakashan Case

In a landmark ruling on March 5, 2025, the National Company Law Appellate Tribunal (NCLAT) held that once a Section 7 application under the Insolvency and Bankruptcy Code, 2016 (IBC) is admitted, the Corporate Insolvency Resolution Process (CIRP) becomes a proceeding in rem.

The judgment came in the case of Kriti Prakashan Pvt. Ltd., where the corporate debtor settled dues with SIDBI after admission of the Section 7 petition and sought withdrawal under Section 12A. However, HDFC Bank filed its financial claim and objected to the withdrawal. The NCLAT upheld the NCLT’s order rejecting the withdrawal, stressing that:

CIRP protects the collective rights of all creditors, not just the applicant.

Even before the CoC is constituted, objections from other creditors must be considered.

A settlement with one creditor cannot override claims of others.

This video explains the facts, arguments, legal provisions, case law precedents (Swiss Ribbons, Abhishek Singh, GLAS Trust v. Byju Raveendran), and the key takeaways for insolvency professionals, creditors, and corporate debtors.

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