Unregistered Documents Cannot Create Security Interest to Retain Title Deeds: NCLAT Dismisses Appeal

Mr. V. Jaisankar vs Mr. Mahalingam Suresh Kumar CITATION : 2025 TAXSCAN (NCLAT) 333

The National Company Law Appellate Tribunal (NCLAT) has held that unregistered documents, including a Memorandum of Deposit of Title Deeds (MoDT), cannot create a valid security interest to retain title deeds of a corporate debtor's property during liquidation proceedings.

Mr. V. Jaisankar, the appellant, filed a Company Appeal challenging the order of the National Company Law Tribunal (NCLT), Chennai. The NCLT had allowed an application by the Liquidator of M/s. Ganga Foundations Private Limited (the Corporate Debtor) and directed the appellant to hand over the original title deeds of a property belonging to the Corporate Debtor.

The NCLAT bench comprising Justice Sharad Kumar Sharma (Member Judicial) and Jatindranath Swain (Member Technical), after considering the rival submissions, upheld the NCLT's order. The Tribunal observed that the Agreement for Sale, by itself, does not confer title and the appellant had failed to take steps to execute a Sale Deed.

Regarding the MoDT, the Tribunal held that since it was intended to create an "Equitable Mortgage," it was a document required to be registered under the Registration Act. The failure to register it meant it could not be read in evidence and could not create a valid security interest. The Tribunal emphasized that under Section 77(3) of the Companies Act, an unregistered charge cannot be taken into account by a liquidator. The absence of any entry for the alleged loan in the Corporate Debtor's books further weakened the appellant's claim.

Post-Reservation Application to Deposit Rs. 15.62 Crores Under Rule 11 Not Maintainable: NCLAT Dismisses Appeal

Satinder Singh Bhasin Erstwhile Director of Bhasin Infotech andInfrastructure Pvt Ltd vs Col Gautam Mullick & Ors CITATION : 2025 TAXSCAN (NCLAT) 334

The Delhi bench of the National Company Law Appellate Tribunal (NCLAT) in a recent case held that a post-reservation application to deposit Rs. 15.62 Crores under Rule 11 is not maintainable.

The two-member bench of the Tribunal comprising Yogesh Khanna(Judicial Member)and Ajai Das Mehrotra (Technical Member)held that once a matter is reserved for judgment, no further applications can be entertained, as parties’ rights and privileges stand concluded.

Relying on Arjun Singh v. Mohindra Kumar (1963), Rajesh Dua v. Rajiv Goyal (2024), and Loramitra Rath v. JM Financial ARC (2023), the Tribunal ruled that post-reservation applications, including those for deposit or stay, are not maintainable.

NCLAT dismisses Wadhawan's Appeal, Upholds Insolvency Proceedings against PPIL

Sarang Kumar Wadhawan vs Unity Small Finance Bank Ltd CITATION : 2025 TAXSCAN (NCLAT) 335

In a recent ruling, the National Company Law Appellate Tribunal (NCLAT), Principal Bench in New Delhi, dismissed an appeal filed by Sarang Kumar Wadhawan, a shareholder of Privilege Power Infrastructure Limited (PPIL), and upheld the initiation of the Corporate Insolvency ResolutionProcess (CIRP) for a default of over Rs. 138 crore.

The appeal was against an NCLT order admitting a Section 7 application by Unity Small Finance Bank (formerly Punjab and Maharashtra Co-operative Bank). The debt originated from an overdraft facility availed by PPIL from 2007 to 2013, with the account being declared a Non-Performing Asset (NPA) in 2012.

The NCLAT bench, comprising Justice Ashok Bhushan (Chairperson), Barun Mitra, and Arun Baroka (Members), held that the Financial Creditor's application was maintainable and within limitation on multiple grounds. The Tribunal agreed that the limitation period started from the discovery of fraud in 2019 under Section 17 of the Limitation Act.

It also held that the documents executed in 2017-2018 were a valid 'promise to pay' under Section 25(3) of the Contract Act, which revived the debt and started a fresh limitation period. The bench rejected the appellant's arguments, noting that he was an active participant in concealing the default and could not be allowed to take advantage of his own wrong.

Demand Notice to Personal Guarantors Mandatory: NCLAT allows appeal of SBI

State Bank of India vs Dr. Jitendra Das Maganti CITATION : 2025 TAXSCAN (NCLAT) 336

In a recent ruling, the Chennai bench of the National Company Law Appellate Tribunal (NCLAT) set aside orders passed by the National Company Law Tribunal (NCLT), Amaravati Bench which was rejecting application of SBI.

The appellate tribunal held that the service of a demand notice is a mandatory condition precedent for initiating insolvency resolution proceedings against personal guarantors under Section 95 of the Insolvency and Bankruptcy Code (IBC).

The NCLAT bench comprising Justice Sharad Kumar Sharma (Member Judicial) and Jatindranath Swain (Member Technical), delivered a detailed judgment. The Tribunal first addressed the mandatory nature of the notice, interpreting Section 95 of the IBC in conjunction with Rule 7 of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019, and Form B. The NCLAT held that a harmonious reading of these provisions makes it clear that serving a demand notice 14 days before filing the application is a mandatory condition precedent.

The NCLAT termed this an "admission" and the "best evidence," stating that the guarantors could not be allowed to resile from their own admission made in a separate legal forum. The Tribunal observed that the purpose of serving a notice is to impart knowledge, which was evidently achieved, as the guarantors were sufficiently aware of the notice to challenge the very provision under which it was issued.

NCLAT Upholds Mediated Family Settlement, dismisses Plea citing Duress and Incomplete Terms

Sonali Prashant Shinde vs Vikram Vilasrao Salunke CITATION : 2025 TAXSCAN (NCLAT) 337

The Principal Bench of the National Company Law Appellate Tribunal (NCLAT) in New Delhi dismissed which challenged the NCLT order upholding a mediated family settlement. The Tribunal viewed that the finality of a mediated settlement must be respected, and objections based on subsequent events or incomplete annexures cannot be allowed to defeat a bona fide agreement.

The NCLAT bench, comprising Justice Yogesh Khanna (Member Judicial) and Mr. Ajai Das Mehrotra (Member Technical), analyzed the allegations under the Indian Contract Act, 1872. It found the allegations of coercion, undue influence, and duress to be 'vague conjectures' without any substantive proof. The bench noted that the parties were educated family members who stood on an equal footing and were bound by their signed agreement.

The Tribunal relied on the mediator's final report, which clarified that the main terms were final and a subsequent meeting was held only to formalize the annexures, which were then signed. It was also noted that the Appellant, Ms. Shinde, had already received the full settlement amount. The Tribunal further held that there was no breach of the Mediation Rules, 2016, and that the procedural timelines were directory.

It was observed that a settlement agreement, signed by parties of full age and sound mind, cannot be set aside on vague and unsubstantiated allegations of duress, coercion, and undue influence.

Lease Termination During Moratorium Invalid u/s 14: NCLAT Quashes GIDC’s Action, Sets Aside NCLT Order Remitting Resolution Plan

The National Company Law Appellate Tribunal (NCLAT), Principal Bench, Delhi, has ruled that Gujarat Industrial Development Corporation’s (GIDC) lease termination against GPT Steel Industries Ltd. during the moratorium was invalid under Section 14 of the IBC. The Tribunal also set aside the NCLT’s order sending the approved resolution plan back to the CoC, holding that there was no violation of Section 30(2).

These appeals arose from the insolvency proceedings of GPT Steel Industries Ltd., where two interlinked orders of the NCLT, Ahmedabad Bench, dated 8 April 2024, were under challenge. In one order, the AdjudicatingAuthority refused to quash the termination of the corporate debtor’s lease by the Gujarat Industrial Development Corporation (GIDC) during the moratorium.

The Appellate Bench comprising Ashok Bhushan (Chairperson), Barun Mitra, and Arun Baroka (Technical Members) rejected GIDC’s arguments, holding that the termination of the lease during moratorium violated Section 14 of the IBC. The Tribunal observed that the moratorium is a statutory freeze meant to protect the corporate debtor’s assets and ensure a smooth resolution process.

The NCLAT held that GIDC’s action of terminating the lease and initiating eviction proceedings was “clearly hit by Section 14” and that the NCLT had jurisdiction under Section 60(5)(c) of the IBC to adjudicate such disputes. It noted that the leasehold rights formed an essential part of the resolution plan and could not be stripped away during the CIRP.

NCLAT sets aside NCLT Order as Appellant Not Heard, remands Settled Insolvency Matter

Mehul Harish Gosar vs M/s.Athena Constructions Ltd CITATION : 2025 TAXSCAN (NCLAT) 339

In a recent ruling, the National Company Law Appellate Tribunal (NCLAT), Principal Bench, set aside an order of the National Company Law Tribunal (NCLT), Mumbai Bench, and remanded the matter back, citing a violation of the principles of natural justice.

The appeal was preferred by Mehul Harish Gosar against the NCLT, Mumbai Bench's order dated 08.05.2025, which had admitted M/s. Parorch Developers LLP into the Corporate Insolvency Resolution Process (CIRP) on an application by a financial creditor.

A bench comprising Justice N. Seshasayee (Judicial) and Mr. Arun Baroka (Technical) agreed that the appellant had not been heard on merits, and the impugned order was liable to be set aside on this ground alone. While acknowledging that the financial debt had been settled between the parties, the Tribunal observed that since the CIRP had already commenced, the Interim Resolution Professional (IRP) might have received other claims which could not be ignored.

Benefit under BIFR Scheme cannot be Claimed after Approval of Resolution Plan under IBC: NCLAT rules in favour of Axis Bank Ltd

Trinity Auto Components Ltd vsAxis Bank Ltd CITATION : 2025 TAXSCAN (NCLAT) 340

In a ruling which favours Axis Bank Ltd, the New Delhi bench of the National Company Law Appellate Tribunal (NCLAT) has held that benefit under the Board for Industrial & Financial Reconstruction (BIFR) scheme cannot be claimed after approval of resolution Plan under the Insolvency Bankruptcy Code (IBC), 2016.

Trinity Auto Components Ltd., the appellant challenged the order dated 26.06.2024 passed by the National Company Law Tribunal, Mumbai Bench, Court-II, whereby the IA No. 2585 of 2019 moved by the appellant has been partly allowed. The case of the appellant as is reflected from the record is that the appellant/Trinity Auto Components Ltd. was engaged in the manufacture of critical closed die forged parts for engines and chassis for heavy commercial vehicles.

The tribunal bench comprising Justice Mohammad Faiz Alam Khan and Mr. Naresh Salecha (Technical Member) observed that the demand in the present case arises from differential interest rate under the BIFR scheme which qualifies as a financial debt under section 5(8) of the IBC. The Respondent had ample opportunity having 96% voting rights in the CoC to include its claim under Regulation 12 of the Corporate Insolvency Resolution Process (CIRP) Regulations, 2016 and in the approved resolution plan. Having approved the resolution plan without any reference to this amount, the bank cannot now revive the claim as it would defeat the objectives of the IBC and the principle of clean slate.

The bench held that the failure of the BIFR scheme does not create an independent cause of action that too after the approval of the resolution plan by none other than the Respondent itself.

NCLAT Allows Salman Khan’s Withdrawal of ₹7.24 Crore Insolvency Plea against Jerai Fitness on Mutual Settlement

Salman Khan vs Jerai FitnessLtd.CITATION : 2025 TAXSCAN (NCLAT) 341

The National Company Law AppellateTribunal (NCLAT) recorded the consent terms by Bollywood superstar Salman Khan and Jerai Fitness on mutual settlement. The bench allowed the withdrawal of his ₹7.24 crore insolvency application bringing an end to the protracted legal battle between the two parties.

In an apparent attempt to delay the well-known case, Jerai Fitness filed for corporate insolvency resolution processes (CIRP) in 2021 under the Insolvency and Bankruptcy Code (IBC), 2016.

Khan's withdrawal of the insolvency petition essentially opens the door for the CIRP against Jerai Fitness to be terminated. The National Company Law Tribunal (NCLT) bench comprising Justice Ashok Bhushan [ Chairperson] and Arun Baroka [Technical Member] which was in charge of the insolvency procedure, is anticipated to formally end the proceedings now that the parties have resolved the main disagreement. This settlement puts an end to a convoluted legal dispute that has persisted for years in business and legal circles.

Partial Loan Disbursement Not a Valid Ground to Reject Insolvency Plea: NCLAT Upholds Axis Bank’s Section 7 Admission

Ammeet Kamal Agarwal SuspendedDirector of Supreme Transport Organisation Pvt. Ltd. vs Axis Bank Ltd. &Anr. CITATION : 2025 TAXSCAN (NCLAT) 342

The National Company Law Appellate Tribunal ( NCLAT ) upheld the Adjudicating Authority’s decision admitting Axis Bank’s Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC), application against the corporate debtor, ruling that partial loan disbursement cannot be a ground to reject an insolvency plea.

The two-member bench comprising Justice AshokBhushan ( The Chairperson) and Arun Baroka ( Technical Member) considered the submissions of both parties and examined the record. It noted that although the appellant claimed a loan of ₹24.90 crore was sanctioned while only ₹12.90 crore was disbursed, the non-disbursement of the full amount could not be a reason to reject the Section 7 application. The sanction was later revised to ₹12.50 crore.

The tribunal observed that while the Section 7 application mentioned the mortgaged property, there was no registered mortgage deed on record.It stated that a mortgage could be claimed only for assets where title deeds were actually deposited, and since no such deeds were shown, the mortgage claim could not be accepted. It also found it unnecessary to give any finding on the mortgage or title issue at that stage.

The appellate tribunal held that debt and default were clearly established, the disbursement was undisputed, and there was no claim of repayment.

The bench also noted that the appellant had expressed readiness to make a higher offer under Section 12A and clarified that a fresh proposal could be made to the Committee of Creditors as per law.

NCLAT Stays CCI’s Five-Year Ban on WhatsApp–Meta Data Use for Ads, Orders Partial Penalty Deposit

Whatsapp LLC vs CompetitionCommission of India CITATION : 2025 TAXSCAN (NCLAT) 343

The Principal Bench of the National Company Law Appellate Tribunal (NCLAT), New Delhi, has granted partial interim relief to WhatsApp LLC and its parent company, Meta Platforms Inc., against a Competition Commission of India (CCI) order that penalised them and restricted user data sharing for advertising purposes.

The CCI’s impugned order had directed WhatsApp not to share user data collected on its platform with Meta or its associated products for advertising for five years. It also mandated new user consent mechanisms for data sharing “for purposes other than advertising” and imposed a monetary penalty on Meta.

The two-member bench comprising Justice Ashok Bhushan and Arun Baroka (Technical Member)held that while CCI had the authority to examine competition issues, the five-year blanket ban on data sharing for advertising could disrupt WhatsApp’s business model, which offers free services supported by advertising.

Partial Loan Disbursement Not a Valid Ground to Reject Insolvency Plea: NCLAT Upholds Axis Bank’s Section 7 Admission

Ammeet Kamal Agarwal vs AxisBank Ltd CITATION : 2025 TAXSCAN (NCLAT) 344

The National Company Law Appellate Tribunal ( NCLAT ) upheld the Adjudicating Authority’s decision admitting Axis Bank’s Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC), application against the corporate debtor, ruling that partial loan disbursement cannot be a ground to reject an insolvency plea.

The two member bench comprising Justice Ashok Bhushan ( The Chairperson) and Arun Baroka ( Technical Member) considered the submissions of both parties and examined the record. It noted that although the appellant claimed a loan of ₹24.90 crore was sanctioned while only ₹12.90 crore was disbursed, the non-disbursement of the full amount could not be a reason to reject the Section 7 application. The sanction was later revised to ₹12.50 crore.

The bench also noted that the appellant had expressed readiness to make a higher offer under Section 12A and clarified that a fresh proposal could be made to the Committee of Creditors as per law. Regarding the claim that some assets were sold after the moratorium, it stated that such issues were not relevant to the present appeal and could be raised before the Adjudicating Authority.

NCLAT Upholds Denial of Access to Rejected Valuation Reports, Affirms Distinction Between CoC Members and Participants

Manish Bagrodia vs Anil Kohli CITATION : 2025 TAXSCAN (NCLAT) 345

In a recent ruling, the National Company Law Appellate Tribunal (NCLAT), Principal Bench, dismissed an appeal by Manish Bagrodia, an ex-director of Winsome Yarns Limited, upholding a National Company Law Tribunal (NCLT) order that denied him access to the first set of valuation reports.

NCLAT held that there is a clear distinction between 'members' of the Committee of Creditors (CoC) and 'participants' like suspended directors, with access to confidential reports being limited to the former.

The bench comprising Justice Ashok Bhushan (Chairperson) and Barun Mitra (Member, Technical) observed that the CoC, exercising its commercial wisdom, had found the initial valuation reports to be 'high-pitched' and had subsequently rejected them, appointing new valuers. The Tribunal noted that the appellant was only asked to leave the meeting during the confidential discussion of these specific, rejected reports and was allowed to participate in all other deliberations, including those on the resolution plans.

The NCLAT found that Regulation 35(2) of the CIRP Regulations mandates that valuation reports be shared only with 'members of the committee' the financial creditors and not with 'participants' like the suspended director. The Tribunal viewed that since the first set of reports had been discarded by the CoC and were no longer relevant to the process, insisting on them was an attempt to derail the CIRP and lacked legal basis.

NCLAT allows Liquidator to remove Auctioned Assets, rejects Reliance Realty's Ownership Claims and Obstruction of Sale Process

RELIANCE REALTY LIMITED vs ANUPKUMAR CITATION : 2025 TAXSCAN (NCLAT) 346

In a recent ruling, the National Company Law Appellate Tribunal (NCLAT), Principal Bench, dismissed an appeal by Reliance Realty Limited, upholding a National Company Law Tribunal (NCLT) order that permitted the removal of assets from leased premises. The NCLAT held that the burden of proof to establish ownership of the assets lay with the appellant.

The bench comprising Justice Ashok Bhushan (Chairperson) and Barun Mitra (Member, Technical) observed that Reliance Realty had remained silent throughout the Corporate Insolvency Resolution Process (CIRP) and the subsequent liquidation proceedings, only raising an ownership claim after the auction was concluded. The Tribunal termed this 'tacit acquiescence' and noted that the burden of proof in a dispute over movable property lies with the person asserting ownership.

The NCLAT found that the Draft Agreement relied upon by the appellant was an unsigned, inchoate document, and the internal SAP records were produced without supporting invoices, making them insufficient evidence. The Tribunal emphasised that allowing the appeal at this stage would derail the concluded liquidation process, undermine the sanctity of the auction, and erode investor confidence in the insolvency regime.

Patents Act Trumps Competition Law: NCLAT rules CCI has No Jurisdiction in Patent Rights Disputes

Mr. Swapan Dey vs CompetitionCommission of India CITATION : 2025 TAXSCAN (NCLAT) 347

The National Company Law AppellateTribunal ( NCLAT ) has held that the Patents Act, 1970, as a special statute, prevails over the Competition Act, 2002, and that the Competition Commission of India (CCI) lacks jurisdiction to examine disputes concerning the alleged abuse of patent rights.

The NCLAT bench, comprising Justice Yogesh Khanna (Member Judicial) and Mr. Ajai Das Mehrotra (Member Technical), after considering the rival submissions, dismissed the appeal. The Tribunal placed primary reliance on the judgment of the Division Bench of the Delhi High Court in Telefonaktiebolaget LM Ericsson (PUBL) v. CCI, which had held that the Patents Act is a 'complete code' and a special statute that prevails over the general Competition Act.

The NCLAT noted that the Supreme Court of India had subsequently dismissed a Special Leave Petition filed by the CCI against this High Court judgment. The Tribunal observed that the subject matter of the dispute was the exercise of patent rights by Vifor, a domain exclusively governed by the Patents Act.

IBC’s Time-Bound Framework Bars Relief: NCLAT Refuses to Condone 389-Day Appeal Refiling Delay

M/ s LBF Publications PrivateLimited Agarwal vs M/s A & A Business Consulting Private Limited CITATION : 2025 TAXSCAN (NCLAT) 348

The National Company Law Appellate Tribunal (NCLAT) has dismissed an appeal filed by the appellant after declining to condone a 389-day delay in refiling. The appeal, made under Section 61 of the Insolvency and Bankruptcy Code (IBC), challenged an NCLT order dismissing its Section 9 application.

The Bench comprising N. Seshasayee (Judicial Member) and Arun Baroka (Technical Member) held that the only explanation offered, “delay was unintentional and for reasons beyond control”, did not constitute sufficient cause under law.

The Tribunal observed that the NCLAT Rules require rectification of defects within seven days and that extensions are permissible only upon demonstration of reasonable and justifiable grounds.

Referring to Rules 26 and 14 of the NCLAT Rules, 2016, the Bench reiterated that exemption or condonation can be granted only where genuine obstacles are shown. The Tribunal emphasised that the IBC is a “self-contained code” designed to ensure time-bound resolution of insolvency disputes, and procedural laxity undermines this legislative intent.

Resolution Plan Lacks Feasibility, Viability and IBC Compliance: NCLT Rejects CoC’s ₹1.5 Cr Resolution Plan, Orders Liquidation u/s 33(1)(b)

In Re: M/s SPP InsolvencyProfessionals LLP RP of M/s Shree Ram Cottex Industries Pvt. Ltd vs CITATION : 2025 TAXSCAN (NCLAT) 349

The Ahmedabad Bench of the National Company Law Tribunal (NCLT) has rejected a resolution plan valued at ₹1.5 crore of the petitioner, holding that the plan lacked feasibility, viability, and compliance with Sections 30 and 31 of the Insolvency and Bankruptcy Code (IBC), 2016.

The corporate insolvency resolution process (CIRP) against Shree Ram Cottex Industries Pvt. Ltd. was initiated under Section 9 of the IBC on an application filed by an operational creditor. Pursuant to the admission, a Resolution Professional (RP) was appointed, and the Committee of Creditors (CoC) was constituted with Raj Radhe Finance Ltd. as the sole financial creditor holding 100% voting rights.

The two-member bench comprising Shammi Khan (Judicial Member) and Sanjeev Sharma (Technical Member) observed that the plan lacked any strategic roadmap for revival, no business projections were provided, and the Resolution Applicant’s financial capacity to implement the plan was unsubstantiated.

The company had no ongoing operations, employees, or functional assets, and the plan neither addressed the cause of default nor proposed a workable revival framework. The Tribunal emphasised that mere CoC approval does not exempt a plan from compliance with the IBC framework.

Belated Expression of Interest No 'Material Irregularity' in CIRP: NCLAT Sets Aside NCLT Order, Restores CoC-Approved Resolution Plan

Dorni Vinimoy Private Limited vsRachna Anchalia CITATION : 2025 TAXSCAN (NCLAT) 350

In a recent ruling clarifying the threshold for “material irregularity” under the Insolvency and Bankruptcy Code (IBC), the National Company Law Appellate Tribunal (NCLAT) has held that acceptance of a belated Expression of Interest (EoI) by the Resolution Professional (RP) does not, by itself, vitiate the Corporate Insolvency Resolution Process (CIRP) unless it demonstrably affects fairness or integrity of the process.

The Tribunal below effectively reviewed its own earlier order, which is impermissible under IBC. The objecting PRAs had full opportunity to participate and had even improved their bids during CoC deliberations; hence, claims of concealment or collusion were unfounded.

The two-member bench comprising Justice N. Seshasayee (Judicial Member) and Arun Baroka (Technical Member), allowed the appeals and set aside the NCLT’s order.

The Bench held that while procedural compliance with CIRP Regulations is essential, not every deviation constitutes a “material irregularity.” Only those procedural breaches that compromise the fairness, legality, or integrity of the process can vitiate the outcome.

The Tribunal reasoned that the RP and CoC acted pursuant to a judicial order condoning delay, and their conduct could not be termed collusive or fraudulent. Dorni’s plan was submitted within the same deadline as others, and no undue advantage was conferred. The brief delay in EMD deposit was within the CoC’s discretionary power to condone.

Liquidator cannot Conduct Private Sale without Permission of NCLT under Regulation 33(2)(d) of IBBI: NCLAT

Orissa Alloy Steel PrivateLimited vs S M Steels and Power Limited CITATION : 2025 TAXSCAN (NCLAT) 351

While disposing of cross-appeals arising from the liquidation of Corporate Power Limited, the National Company Law Appellate Tribunal (Principal Bench, New Delhi) has set aside a private sale process for being opaque and procedurally flawed, while directing a fresh Swiss Challenge process with more equitable terms.

A division bench of the NCLAT, comprising Justice (Retd.) Ramalingam Sudhakar and Mr. Ravindra Chaturvedi, held that the Adjudicating Authority had correctly set aside the private sale. The Tribunal found that the manner in which the private sale was conducted demonstrated a lack of transparency and fairness. It agreed that the delayed publication of the Process Document and the compressed timelines for submission of documents and EMD deposit effectively precluded meaningful participation from other bidders, thereby impeding the objective of value maximization.

The NCLAT also affirmed the Adjudicating Authority's finding that the liquidator had contravened Regulation 33(2)(d) of the Insolvency and Bankruptcy Code, 2016, read with the Liquidation Process Regulations, 2016.

However, the NCLAT rejected the allegations of collusion between OASPL and ACRE. It found that while ACRE was a significant creditor, it did not control the requisite 66% voting share in the SCC to unilaterally dictate outcomes. The Tribunal noted that other financial institutions on the committee had voted in favour of OASPL's proposal, and there was no material evidence on record to establish a "secret or dishonest agreement" necessary to prove collusion under the law.

NCLAT Quashes NCLT Order Invalidating Resolution Plan, Rules Amrapali Fincap’s Objections u/s 29A Unfounded

Dr. Vijay Kant Dixit & Anrvs Amrapali Fincap Ltd. & Ors CITATION : 2025 TAXSCAN (NCLAT) 352

The National Company LawAppellate Tribunal (NCLAT) quashed the order of the National Company Law Tribunal (NCLT), New Delhi Bench, observing that the NCLT had erred in holding the successful resolution applicant (SRA) ineligible without any conclusive material to establish disqualification under Section 29A of the Insolvencyand BankruptcyCode, 2016 (IBC).

The matter arose from the resolution process of JC World Project, wherein JC World Hospitality Pvt Ltd was approved as the successful resolution applicant by the Committee of Creditors (CoC).

The two-member bench comprising Justice Rakesh Kumar (Judicial Member) and Dr. Alok Srivastava (Technical Member) noted that the CoC holds the exclusive authority to assess the feasibility and viability of a resolution plan, while the Adjudicating Authority’s role is limited to verifying compliance with the requirements under Section 30(2) of the Code.

The Bench emphasized that Section 29A disqualification must be based on definite evidence, not mere association with related entities or assumptions of default. In the present case, there was no material on record to establish that JC World Hospitality or its promoters were willful defaulters or ineligible under the Code.

NCLT Erred in Ignoring Family Settlement Agreement, Wrongly Relegated Parties to Civil Court Despite Bar u/s 430 of Companies Act: NCLAT

Mrs. C. Valli Narayan vs C.Krishniah Chetty & Sons Private Limited CITATION : 2025 TAXSCAN (NCLAT) 353

The Principal Bench of National Company Law AppellateTribunal (NCLAT) at New Delhi, has set aside the orders of the National Company Law Tribunal (NCLT), Bengaluru Bench, passed in a long-standing dispute over the control and management of a jewellery business.

The Bench comprising Arun Baroka (Technical Member) observed that the company was run as a family enterprise and that both sides had mutually admitted a complete breakdown of trust. The Tribunal held that such disputes, especially where there is equal shareholding and management deadlock, attract the equitable jurisdiction of the NCLT and NCLAT under Sections 241 and 242 of the Act.

The NCLAT found that the NCLT had failed to properly examine the Family Settlement Agreement, the extent of oppression, and the alleged diversion of business. It further observed that civil court jurisdiction in such matters is expressly barred under Section 430 and that the NCLT had committed a jurisdictional error by suggesting that the Appellants approach a civil court.

NCLAT Upholds CCI’s Jurisdiction Under Section 4 of the Competition Act to Probe WhatsApp–Meta Data-Sharing Practices

WhatsApp LLC vs CompetitionCommission of India CITATION : 2025 TAXSCAN (NCLAT) 354

In a landmark judgment, the National Company Law Appellate Tribunal (NCLAT) has upheld the Competition Commission of India’s (CCI) jurisdiction to investigate WhatsApp and its parent company, Meta Platforms Inc., for alleged abuse of dominance under Section 4 of the Competition Act, 2002.

The two member bench comprising AshokBhushan (Judicial member) and Arun Baroka observed that the Competition Act and data protection laws operate as complementary frameworks, not exclusive ones.

The Tribunal stated that while privacy laws address individual consent and protection, competition law examines whether such policies are used as tools of market abuse. “The mere overlap in subject matter does not oust the jurisdiction of the CCI,” the order noted.

The Tribunal also upheld CCI’s findings that WhatsApp’s 2021 policy differed materially from its 2016 version, especially because the latter offered users an opt-out option that was absent in the 2021 update. However, the Tribunal granted partial interim relief, staying only the five-year ban on data sharing for advertising, citing possible disruption to WhatsApp’s business model.

Implied Consent Validates Lease Transfer to Corporate Debtor: NCLAT Rejects Plea to Exclude Govt Land from Liquidation

West Bengal HousingInfrastructure Development Corporation Ltd. vs Kshitiz Chhawchharia CITATION : 2025 TAXSCAN (NCLAT) 355

The National Company Law Appellate Tribunal (NCLAT), principal bench, New Delhi has dismissed West Bengal Housing Infrastructure Development Corporation Ltd.’s (WBHIDCO) appeal challenging the inclusion of government-leased land in the liquidation estate of the respondent.

NCLAT found that WBHIDCO’s conduct,engaging in meetings, requesting rectified orders, and delaying objections,amounted to implied consent. The Tribunal emphasized that while no express approval was granted, WBHIDCO’s actions supported the inference that it had acquiesced to the lease transfer. It held that the appellant could not now claim exclusion of the land from the liquidation estate, especially without challenging the merger or its rectification.

The two-member bench comprising Mohd. Faiz Alam Khan (Judicial Member) and Arun Baroka (Technical Member) Tribunal also noted that WBHIDCO failed to file any claim within the statutory 30-day window from the liquidation commencement date in 2018. Its assertion of being a secured creditor was raised only during final arguments and not pleaded in the appeal, rendering the claim procedurally untenable.

Rejection Solely on Ground of Delay Unsustainable: NCLAT Orders Inclusion of Genuine Homebuyer Claims in Resolution Plan

Ms. Reena vs Rabindra KumarMintri & Anr CITATION : 2025 TAXSCAN (NCLAT) 356

in a recent ruling, the equitable treatment of homebuyers under the Insolvency and Bankruptcy Code (IBC), the National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, has set aside the order of the Adjudicating Authority (NCLT) which had dismissed belated claims of several homebuyers in the Today Homes Noida Pvt. Ltd. insolvency proceedings.

The NCLAT, headed by Chairperson Justice Ashok Bhushan, delivered a composite judgment in a batch of appeals filed by multiple homebuyers, including Dr. Anubha Varun and others, challenging the NCLT’s order dated 22 January 2025 which dismissed their applications for acceptance of belated claims in the corporate insolvency resolution process (CIRP) of Today Homes Noida Pvt. Ltd. The Adjudicating Authority had rejected the claims on the sole ground that they were filed beyond 90 days from the commencement of the CIRP.

The tribunal said that the essence of the IBC is to ensure fair treatment of all stakeholders and that procedural rigidity cannot override substantive justice, especially where the buyers’ investments are duly acknowledged.

Technical Objections like Insufficient Stamp Duty Cannot Defeat Insolvency Proceedings When Debt and Default Proven: NCLAT Siddharth Satish Katariya vsCentral Bank of Indi CITATION : 2025 TAXSCAN (NCLAT) 357

The National Company Law Appellate Tribunal (NCLAT), Principal Bench at New Delhi, has dismissed an appeal filed by assessee, suspended Director, and upheld the order of the National Company Law Tribunal (NCLT), Mumbai Bench, admitting a Section 7 application under the Insolvency and Bankruptcy Code, 2016 (IBC).

The Bench comprising Justice Ashok Bhushan (Chairperson) and Barun Mitra (Technical Member) examined the rival submissions and upheld the NCLT’s findings.

The Tribunal noted that both sanction letters dated 26.12.2019 and 09.09.2020 categorically provided that “existing securities shall continue to be security for the revised facilities.” Hence, the guarantees executed in 2015 and 2016 remained valid and binding.

Regarding the stamp duty objection, the Bench observed that both the Principal Borrower and Corporate Guarantor possessed valid Stamp Duty Exemption Certificates issued by the Directorate of Industries, Maharashtra. Moreover, any alleged deficiency was curable, and the borrower had undertaken to bear the cost if required. The Tribunal emphasized that insolvency proceedings cannot be stalled on hyper-technical objections when debt and default stand established.

The Bench further held that each member of a banking consortium possesses independent rights to enforce its debt and initiate insolvency proceedings, and the Central Bank of India was fully entitled to file the Section 7 application in its individual capacity.

No Direct Approval for Amrapali Plan: NCLAT Upholds NCLT Direction to Reconsider Resolution or Issue Fresh Form G

Dr. Vijay Kant Dixit & Anrvs Amrapali Fincap Ltd. CITATION : 2025 TAXSCAN (NCLAT) 358

The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, has clarified the voting mechanism for financial creditors in a class under Section 25A(3A) of the Insolvency and Bankruptcy Code, 2016 (IBC), while dismissing cross-appeals filed by Amrapali Fincap Ltd. and a homebuyer.

The Bench held that where a majority of homebuyers vote in favour of a resolution plan, the Authorised Representative is bound to cast 100% of the class vote in that direction. However, the Tribunal declined to grant automatic approval to Amrapali’s plan, affirming the NCLT’s discretion to permit the Committee of Creditors (CoC) to either reconsider the plan or issue a fresh Form G under Section 30(4).

The Tribunal, comprising Justice Ashok Bhushan (Chairperson) and Barun Mitra (Technical Member), analysed Section 25A(3A) which governs voting by financial creditors in a class along with Section 30(4) which deals with CoC approval of the IBC.

Lien Cannot Cover Group Company Debts When CD Has No Liability: NCLAT Orders ICBC to Release ₹27.60 Cr FDIndustrial and Commercial Bankof China Limited vs Anish Niranjan Nanavaty & Ors CITATION : 2025 TAXSCAN (NCLAT) 359

The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, has dismissed an appeal filed by Industrial and Commercial Bank of China (ICBC) and upheld the order of the National Company Law Tribunal (NCLT), Mumbai Bench, directing the bank to release a fixed deposit of ₹27.60 crore belonging to Reliance Communication Infrastructure Ltd. (RCIL).

The dispute revolved around whether ICBC could retain the FD under a lien to secure loans advanced to other Reliance Group companies, despite RCIL itself having no outstanding liability to the bank.

The Tribunal rejected these arguments. The three-member bench comprising Ashok Bhushan (Judicial member), Barun Mitra (Technical Member) and Arun Baroka (Technical Member) closely examined the lien letter dated 27 March 2017. Clause (1) of the letter authorised ICBC to hold securities for “any other moneys now due or which may at any time be due from us to you, whether singly or jointly with another or others in connection with credit facilities provided to us by you.”

GST Liability Becomes Operational Debt Post-CIRP: NCLAT Upholds Claim Transfer to Private Creditor, Dismisses Ellison Oil’s AppealEllison Oil Field Services Pvt.Ltd vs CITOC Ventures Pvt. Ltd CITATION : 2025 TAXSCAN (NCLAT) 360

The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, has dismissed Ellison Oil Field Services Pvt. Ltd.’s appeal challenging the validity of a debt assignment by the GST Department to a private entity during the Corporate Insolvency Resolution Process (CIRP).

The two-member bench comprising Rakesh Kumar Jain (Judicial Member) and Naresh Salecha (Technical Member) distinguished between tax dues before CIRP and their status post-admission. It held that while tax can only be levied and collected under statutory authority, once CIRP begins and a moratorium applies, recovery under GST law is barred.

At that stage, the dues crystallise into operational debt, which falls within the IBC framework. As an operational creditor, the GST Department was entitled to assign its debt, and CITOC Ventures lawfully stepped into its shoes. The Tribunal found no error in the RP’s actions and upheld the CoC’s reconstitution. It also noted that Ellison Oil had already been paid its claim, undermining its grievance.

Assessment of PF Dues During Moratorium Violates Statutory Freeze: NCLAT Sets Aside EPFO’s Post‑Moratorium ClaimsCA Pankaj Shah vs EmployeeProvident Fund Organisation & Anr CITATION : 2025 TAXSCAN (NCLAT) 361

The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, has held that assessment of provident fund dues during moratorium under Section 14 of the Insolvency and Bankruptcy Code (IBC) is impermissible.

Dismissing appeals filed by both the Resolution Professional (RP) and the Employees’ Provident Fund Organisation (EPFO), the Tribunal ruled that post‑moratorium claims based on fresh assessment orders cannot be admitted in CIRP.

NCLAT examined the issue in light of Supreme Court precedents. In Rajendra K. Bhutta v. MHADA (2020), the Court held that a moratorium creates a statutory status quo, overriding other laws under Section 238 of IBC. In P. Mohanraj v. Shah Brothers Ispat (2021), the Court clarified that “proceedings” under Section 14 include all actions affecting the debtor’s assets, not just recovery suits.

Applying these principles, the two-member bench comprising Ashok Bhushan (Judicial Member) and Barun Mitra (Technical Member) held that EPFO’s assessment orders dated 25 September 2023 were passed after the moratorium commenced and therefore impermissible. Any claims based on such post‑moratorium assessments could not be admitted in CIRP.

The Tribunal further upheld NCLT’s directions requiring EPFO to furnish employee‑wise details and computations, noting that claims based on notional figures cannot be accepted.

NCLAT Holds IBC S.9 Claim Time-Barred, Rejects Interest Addition to Cross ₹1 Cr Threshold u/s 4

Ahio Overseas LLP vs None CITATION : 2025 TAXSCAN (NCLAT) 362

In a significant ruling, the National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, has quashed the admission of an insolvency application filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC) against the appellant as time- barred. The appeal arose from an order of the National Company Law Tribunal (NCLT), which had admitted the petition for default of ₹1.71 crore, comprising a principal sum of ₹84.88 lakh and interest of ₹86.39 lakh.

The three-member bench comprising Rakesh Kumar Jain (Judicial Member), Mohd. Faiz Alam Khan (Judicial Member) and Naresh Salecha(Technical Member) held that interest cannot be added unless there is a contractual agreement between the parties. Merely mentioning interest in invoices is a unilateral act and cannot bind the debtor. The tribunal noted the inconsistency in the claimed rates and found no evidence of any interest agreement.

In reaching this conclusion, the tribunal relied on its decision in Jai Narain Fabtech Pvt. Ltd. v. Cheema Spintex Ltd. (2025), which held that unilateral interest claims cannot be considered for threshold calculation. It distinguished the case relied upon by NCLT, Prashant Kumar Agarwal v. Vikash Parasrampuria (2022), as inapplicable.

Deficient Proof of Payment & Illegal Flat Allotment Render Claims Non-Creditor: NCLAT Affirms NCLT’s Dismissal of Appeals

Ms. Sneha Kore vs Mr. ArunKapoor CITATION : 2025 TAXSCAN (NCLAT) 363

The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, has affirmed the dismissal of appeals filed by the appellants against the rejection of their claims in the corporate insolvency resolution process (CIRP) of Monarch Brookfields LLP. The appellants had challenged orders of the National Company Law Tribunal (NCLT), Mumbai, which refused to admit their claims on grounds of delay, lack of proof of payment, and illegality of the flats allotted to them.

The Tribunal noted that the agreements relied upon were unexecuted and unstamped, conferring no legal right or title. It further observed that the flats in question were unsanctioned and illegal, falling outside the approved building plan, and therefore could not be regularized or delivered.

On the issue of public announcement, NCLAT ruled that publication in Financial Express and Mumbai Lakshadweep was in compliance with Regulation 6 of the CIRP Regulations, and appellants could not claim ignorance merely because they resided in Kolhapur.

The Tribunal underscored that the appellants’ claims were filed after an inordinate delay of 1357 days from CoC approval of the resolution plan, without any plausible explanation. It reiterated that the commercial wisdom of the CoC in approving a resolution plan is non-justiciable and cannot be reopened to accommodate belated claims.

The three-member bench comprising Rakesh Kumar Jain (Judicial Member), Mohd. Faiz Alam Khan (Judicial Member) and Naresh Salecha(Technical Member), after examining the submissions, held that the appellants failed to establish themselves as financial creditors under Section 5(8) of the IBC, as no evidence of payment to the corporate debtor was found in its books or bank accounts.

Fake Certificates, Common IP & Cover Bids Prove Collusion: NCLAT Upholds CCI’s Order Against Appellant

M/s Satish Kumar Agarwal, SoleProprietor vsCompetition Commission of India CITATION : 2025 TAXSCAN (NCLAT) 364

The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, in a recent judgment, dismissed the appeal filed by the appellants against the Competition Commission of India’s (CCI) order. The CCI had found the appellants guilty of bid‑rigging and collusive bidding in soil testing tenders floated by the Department of Agriculture, Government of Uttar Pradesh, during 2017–2018.

The proceedings originated from a complaint alleging cartelisation in two e‑tenders for soil sample testing in Bareilly and Moradabad. The complaint pointed to coordinated bidding by multiple entities, including Yash Solutions, Satish Kumar Agarwal, Siddhi Vinayak & Sons, Saraswati Sales Corporation, and Austere Systems. The CCI, after directing a detailed investigation by the Director General (DG), concluded that the parties had indulged in cover bidding, bid rotation, and collusive practices to manipulate tender outcomes.

The three-member bench comprising Rakesh Kumar Jain (Judicial Member), Mohd. Faiz Alam Khan (Judicial Member) and Indevar Pandey (Technical Member) rejected these arguments, noting that the appellants knowingly submitted fabricated documents to qualify for tenders.

Also, evidence of shared IP addresses, identical invoices, and coordinated bidding demonstrated active collusion. And the plea of being misled was untenable, as Mr. Satish Kumar Agarwal admitted to using Yash Solutions’ assistance and failed to contest the Department of Agriculture’s blacklisting of his concerns.

Exclusion of COVID Period Preserves 208-Day Limitation: NCLAT Holds S. 95 Petitions Against Guarantors Timely

J C Flower Asset ReconstructionPvt. Ltd vs Mr. Mehul Gor & another CITATION : 2025 TAXSCAN (NCLAT) 365

The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, delivered a significant judgment in the appeals challenging two orders of the National Company Law Tribunal (NCLT), which had dismissed the appellants' Section 95 applications against personal guarantors as time‑barred. NCLAT’s ruling clarifies the application of the Supreme Court’s COVID limitation exclusion orders to insolvency proceedings under the Insolvency and Bankruptcy Code, 2016 (IBC).

The two-member bench comprising N. Seshasayee (Judicial Member) and Arun Baroka (Technical Member)accepted the appellant’s interpretation. It held that the Supreme Court’s orders excluded the entire period from 15 March 2020 to 28 February 2022. Consequently, the balance period of 208 days revived from 01 March 2022, extending the limitation until 25 September 2022.

The petitions filed on 17 August 2022 were therefore within time. The tribunal emphasised that authoritative pronouncements of the Supreme Court leave no doubt that exclusion of the COVID period results in enlargement of limitation, not mere substitution with a 90‑day grace period.

Leasehold Rights Not Proved: NCLAT Holds Industrial Unit Cannot Be Treated as Corporate Debtor’s Asset for CIRP

Committee of Creditors ofJupitar Spun Pipes vs Bihar State Industrial Development Corporation Ltd. &Ors. CITATION : 2025 TAXSCAN (NCLAT) 366

In a significant ruling addressing the scope of asset verification during insolvency proceedings, the National Company Law Appellate Tribunal (NCLAT) principal bench, New Delhi has upheld the National Company Law Tribunal’s refusal to approve a resolution plan for Jupiter Spun Pipes & Casting Pvt. Ltd.

The appellate tribunal held that the corporate debtor failed to establish valid leasehold rights over a large industrial unit, and therefore, the asset could not be treated as part of its estate for CIRP purposes.

The appellate bench observed that the NCLT had confined itself to examining whether the corporate debtor had established a valid and enforceable right capable of inclusion in the CIRP asset pool.

The NCLAT further held that determining whether a document is void for lack of authority or unenforceable due to the absence of consideration falls squarely within the adjudicating authority’s jurisdiction.

The two-member bench comprising Ashok Bhushan(Chairperson) and Barun Mitra (Technical Member) underscored that both BSIDC and Magadh had consistently denied execution of the alleged lease and that the document itself referred to authorisations granted to specific officers, none of whom had signed the deed.

Guarantee Covered Existing ₹44 Cr Credit Facilities, Not Future Loan: NCLAT Upholds Admission u/s 95 Against Personal Guarantor

Kiran Kumar Jain vs CosmosCo-Operative Bank Ltd. & Anr. CITATION : 2025 TAXSCAN (NCLAT) 367

The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, delivered a significant ruling affirming the admission of insolvency proceedings under Section 95 of the Insolvency and Bankruptcy Code, 2016 (IBC) against a personal guarantor.

The case revolved around the validity and scope of a personal guarantee executed on 02.03.2016, covering credit facilities aggregating to ₹44 crore extended to the corporate debtor, M/s Dilip Chabria Design Pvt. Ltd.

The Tribunal rejected Jain’s plea, holding that the guarantee covered already‑granted facilities and was supported by documentary evidence, including the loan agreement, promissory note, and repayment schedule. The tribunal noted that repayment obligations commencing immediately after execution of the guarantee demonstrated that disbursal had already occurred.

The two-member bench comprising Ashok Bhushan (Judicial member) and Barun Mitra(Technical Member) held that the invocation of the guarantee was established through notices issued in 2018, and that pending DRT proceedings did not preclude insolvency action under Section 95. The tribunal clarified that creditors may choose to proceed against one guarantor without being obliged to act against all.

Section 95 of the Insolvency and Bankruptcy Code (IBC) allows a creditor to initiate insolvency proceedings against an individual, including a personal guarantor to a corporate debtor. It empowers creditors to apply to the adjudicating authority, either individually or jointly, seeking resolution of unpaid debts.

Auction Purchaser Cannot Claim Reclassification of NPA if it affects Financial Creditor's Rights: NCLAT rules in favour of IDBI Bank

IDBI Bank Ltd vs Silver StallionLtd CITATION : 2025 TAXSCAN (NCLAT) 368

While disposing of an appeal filed by IDBI Bank Ltd., the National Company Law Appellate Tribunal (Principal Bench, New Delhi) has set aside an order of the Adjudicating Authority that permitted the reclassification of a loan account, holding that an auction purchaser cannot seek concessions that impinge upon a financial creditor's rights against personal guarantors.

A bench of the NCLAT, comprising Justice N. Seshasayee (Member, Judicial) and Indevar Pandey (Member, Technical), found merit in the bank's submissions. The Tribunal held that the rights of a successful auction purchaser are confined to securing a clear title to the asset acquired. It observed that any re-classification of the loan in the bank's books could not extend to a point where it interferes with the bank's statutory and contractual right to proceed against personal guarantors, a right that is distinct from the bank's claim over the auctioned asset.

The NCLAT allowed the appeal. The order of the Adjudicating Authority granting the concession for the reclassification of the loan account was set aside, affirming the financial creditor's rights against the personal guarantors as distinct from the rights of the auction purchaser over the acquired assets.

NCLAT sets aside Insolvency Proceedings against Mahagun, Remands Matter to NCLT

Amit Jain vs IDBI TrusteeshipServices Ltd CITATION : 2025 TAXSCAN (NCLAT) 369

The National Company Law Appellate Tribunal (Principal Bench, New Delhi) has set aside the National Company Law Tribunal's order admitting a Corporate Insolvency Resolution Process (CIRP) against the entirety of Mahagun (India) Pvt. Ltd., directing that the proceedings be reconsidered with a view to confining them only to the defaulting "Mahagun Manorialle" project. The Tribunal also granted liberty to Aditya Birla Capital Ltd. and other homebuyers to file intervention applications before the NCLT.

The Tribunal noted that Mahagun (India) Pvt. Ltd. is a real estate company engaged in multiple projects across NCR, including Mahagun Manorialle, Mahagun Mywoods, Mahagun Montage, Mahagun Metro Mall, and Hotel Sarovar Portico. The debenture default was specific to the Mahagun Manorialle project, while other projects had different lenders and were performing without defaults.

The bench comprising Justice Ashok Bhushan, Chairperson and Barun Mitra, Member (Technical) observed that initiating CIRP against the entire company would adversely affect more than 8,000 homebuyers across various projects who were not at fault and would jeopardize the objective of value maximization of assets. It noted that different projects had distinct ownership and separate sets of lenders.

NCLAT Dismisses Union Roadways' Insolvency Appeal, Rejects Section 9 Application Citing Pre-existing Payment Disputes and Uncrystallized Debt

Union Roadways Limited vs IceSteel 1 Private Limited CITATION : 2025 TAXSCAN (NCLAT) 370

In a ruling upholding the dismissal of a Section 9 application, the National Company Law Appellate Tribunal (Principal Bench, New Delhi) has confirmed that Union Roadways Limited cannot initiate insolvency proceedings against Ice Steel 1 Private Limited, citing pre-existing payment disputes and uncrystallized debt between the parties.

The Tribunal comprising Justice Ashok Bhusan[Chairperson] and Mr Barun Mitra[ Technical Member] further observed that the Corporate Debtor had identified discrepancies in 135 invoices, where the amounts shown in the invoices placed before the NCLT differed from the amounts reflected in the invoices sent to the Corporate Debtor.

The Tribunal emphasized that it is not required to determine the merits of the dispute at this stage, but only to ascertain whether a plausible contention exists that requires further investigation and is not "a patently feeble legal argument or an assertion of fact unsupported by evidence."

The Tribunal concluded that the disputes raised by the Corporate Debtor were not "spurious, hypothetical or illusory" but genuine disputes that required adjudication by a competent court.

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