Thiruvananthapuram, Jan. 12 -- The National Company Law Tribunal (NCLT) at Kochi has clarified that the avoidance provisions under the Insolvency and Bankruptcy Code (IBC) are designed to neutralise the preferential effect of certain transactions and restore the corporate debtor's estate, rather than impose punitive liability on the beneficiary.

The observation was made by Judicial Member Vinay Goel while partly allowing an avoidance application filed by the Resolution Professional (RP) of Astern Properties and Developers Pvt Ltd under Sections 43 and 44 of the Code.

Background of the Case

Astern Properties was admitted into the Corporate Insolvency Resolution Process (CIRP) on June 13, 2024. During the statutory look-back period for r...