Director's application on collusion and lack of authority cannot be rejected solely for no board resolution or alleged delay.

An application by a suspended director to place allegations of collusion, illegality and lack of authority before the insolvency forum could not be rejected merely for want of a board resolution or on an asserted delay. The application was filed promptly after the applicant learned of the proceedings, and it was made in the director's own capacity to bring relevant facts on record, not on claimed corporate authorisation. The pleadings raised substantive issues about disputed authority and execution of material documents without the applicant's knowledge, which required consideration. The threshold rejection was therefore unsustainable, and the impugned order was set aside.

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Issues: Whether the application filed by a suspended director to place allegations of collusion, illegality, and lack of authority before the Adjudicating Authority could be rejected at the threshold on the grounds of absence of board resolution and alleged delay.

Analysis: The application was filed within three days of the first hearing after the applicant learnt of the proceedings and the reply filed on behalf of the corporate debtor, so it could not be treated as belated. The application was filed by the appellant in his capacity as director to bring relevant facts on record, not on the basis of any claimed board authorisation. Rejection solely for want of board resolution was therefore unsustainable, especially when the reply filed on behalf of the corporate debtor did not itself assert any board resolution. The pleadings raised substantial allegations of collusion, disputed authority, and execution of material documents without the appellant's knowledge, which warranted consideration. Prior observations in the connected appeal could not bar examination of the challenge to the present rejection order.

Conclusion: The rejection of the application at the threshold was incorrect and the impugned order was set aside.

Ratio Decidendi: An application by a director seeking to place material allegations of collusion or lack of authority before the insolvency forum cannot be rejected merely for want of board resolution or on an unfounded plea of delay when it is promptly filed and seeks to assist the adjudication on relevant facts.

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