No Finality on Liquidator Removal Until Voting Rights Issue Settled: NCLAT [Read Order]
The NCLAT held that the outcome of a SCC meeting regarding removal of a liquidator cannot be implemented until the Adjudicating Authority decides on the maintainability of voting rights

NCLAT
NCLAT
The National Company Law Appellate Tribunal (NCLAT) in a recent case, has refused to grant immediate relief to Edelweiss Asset Reconstruction Company Ltd. in its bid to remove the liquidator of Tecpro Systems Ltd., directing the matter back to the adjudicating authority for final decision.
The appeal stemmed from an ongoing tussle between Edelweiss ARC and the liquidator, Ramachandran Subramanian, regarding voting rights in the Stakeholder Consultation Committee (SCC) and the validity of a proposed meeting without Edelweiss’s vote being counted.
Edelweiss, holding a dominant 84.82% vote share in the SCC, had filed an application before the National Company Law Tribunal (NCLT), seeking replacement of the liquidator. At the same time, the liquidator moved a separate application arguing that Edelweiss should be excluded from the SCC, alleging it was a "related party" to the corporate debtor and hence conflicted.
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Even as the related party issue remains undecided, the Adjudicating Authority permitted a meeting of the SCC to be convened on 15th July 2025, excluding Edelweiss from voting.
This prompted Edelweiss to approach the NCLAT, contending that no meeting of the SCC should be permitted until the question of its voting rights is resolved.
The liquidator argued that it was Edelweiss itself who had submitted earlier that even without its vote, the resolution for liquidator's removal would still pass, as other stakeholders supported it. However, acknowledging the short notice and concerns of prejudice, the NCLAT allowed the SCC meeting to proceed, but with strict safeguards.
The Tribunal ordered that the results of the SCC meeting be kept in a sealed cover, without being disclosed or acted upon, and clarified that no final decision or implementation should take place until the NCLT decides both pending applications.
The Appellate Bench, comprising Justice Ashok Bhushan (Chairperson) and Barun Mitra (Technical Member), emphasized that both applications need to be decided by the Adjudicating Authority, and the outcome of the meeting, if any, can be implemented only after such decision. The appellate tribunal Directed the NCLT to dispose of the matter on the next date or at the earliest.
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