Transparent bidding in CIRP is essential; lack of fair negotiations and value maximisation justified fresh re-bidding.

An objecting resolution applicant lacked locus standi to challenge approval of the resolution plan because the record did not reliably show an independent qualifying offer, a duly established association with another bidder, or timely placement of the asserted section 29A affidavit before the Resolution Professional. The bidding process for selecting the successful resolution applicant was nevertheless found insufficiently transparent and fair, as the materials did not clearly disclose open common negotiations or sharing of revised bids, and the procedure did not demonstrably secure best value. The authority held that CIRP time pressure could not justify departure from a fair bidding process, and directed that the plan be returned for a fresh sealed-bid and open-negotiation process.

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Issues: (i) Whether the objecting resolution applicant had locus standi to challenge approval of the resolution plan. (ii) Whether the bidding and negotiation process adopted for selection of the successful resolution applicant was transparent, fair, and compliant with the Insolvency and Bankruptcy Code, 2016 and the CIRP Regulations, and whether the plan should be returned for re-bidding.

Issue (i): Whether the objecting resolution applicant had locus standi to challenge approval of the resolution plan.

Analysis: The objection rested on an asserted association with another resolution applicant and on a purported section 29A affidavit, but no reliable material established that the objector had independently submitted a qualifying offer or resolution plan, or that it was in fact an associate of the other bidder in the manner claimed. The record also did not support the claim that the alleged affidavit had been duly placed before the Resolution Professional in time. On these facts, the objector was not treated as a participant with a sufficient independent basis to challenge approval.

Conclusion: The objection to locus standi failed.

Issue (ii): Whether the bidding and negotiation process adopted for selection of the successful resolution applicant was transparent, fair, and compliant with the Insolvency and Bankruptcy Code, 2016 and the CIRP Regulations, and whether the plan should be returned for re-bidding.

Analysis: The process was found wanting because the minutes and surrounding material did not clearly disclose transparent common negotiations, the revised bids were not shown to have been openly shared, and the procedure adopted gave rise to a reasonable concern that the best value may not have been secured. Although the CIRP was under time pressure, the adjudicating authority held that the time line could not justify departure from a fair and open bidding process. Since approval of a plan must satisfy section 30(2) and must further the object of maximising value and balancing stakeholder interests, the authority concluded that a fresh opportunity for revised bids was necessary.

Conclusion: The resolution plan was directed to be returned and the matter was ordered to be re-bid through a fresh sealed bid and open negotiation process among the three final resolution applicants.

Final Conclusion: Approval of the existing successful resolution plan was declined, and the CIRP was sent back for a short, controlled re-bidding process to secure a fairer and more value-maximising outcome.

Ratio Decidendi: A resolution plan cannot be approved where the bidding process lacks sufficient transparency and fairness and does not demonstrably advance maximisation of value and equitable stakeholder interests under the Code.

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