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Issues: Whether the Appellate Tribunal could direct the Resolution Professional to place the proposed settlement before the Committee of Creditors for e-voting, and whether the application was maintainable without compliance with the statutory procedure for withdrawal of CIRP.
Analysis: The proposed settlement could not be entertained as a direct request to the Resolution Professional for circulation to the Committee of Creditors, since the insolvency framework permits withdrawal only through the procedure prescribed under Section 12A of the Insolvency and Bankruptcy Code, 2016 and Regulation 30-A of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. The application was not accompanied by the prescribed Form FA, was not initiated by the party at whose instance CIRP had commenced, and the draft settlement had not received the consent of the home buyers forming a substantial voting block. In such a statutory regime, the Tribunal could not invoke inherent powers to bypass the express procedure or compel the Resolution Professional to act outside the Code.
Conclusion: The request for direction to place the settlement proposal before the Committee of Creditors was rejected, and the application was held not maintainable in the form presented.
Final Conclusion: The statutory withdrawal mechanism under the insolvency framework is mandatory, and a settlement proposal unsupported by the prescribed application and consent requirements cannot be directed to be placed for voting.
Ratio Decidendi: Where the Insolvency and Bankruptcy Code prescribes a specific withdrawal procedure, the Tribunal cannot use inherent powers to direct circulation of an unapproved settlement proposal to the Committee of Creditors.
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