New Delhi, Feb. 26 -- The Supreme Court on Tuesday held that insolvency proceedings under the Insolvency and Bankruptcy Code (IBC) cannot be kept in abeyance on the basis of a Scheme of Arrangement that has become redundant due to non-compliance with statutory requirements.

A Bench of Justices Sanjay Kumar and K. Vinod Chandran ruled that once the conditions under Section 7 of the IBC are met, the corporate insolvency resolution process (CIRP) must proceed, regardless of parallel company law proceedings.

The court clarified that a compromise under Section 230 of the Companies Act, 2013 may be considered at an appropriate stage within the IBC process.

Background

The case arose from an application by Omkara Assets Reconstruction Pvt. Lt...