Recall versus review in insolvency: tribunal may correct factual errors and grant consequential relief without re-adjudicating merits.

A Resolution Professional may maintain a recall application even after approval of the resolution plan where the application was instituted during CIRP and concerns matters surviving the insolvency process. The recall-review distinction was applied: recall is available to correct factual mistakes, procedural irregularities, or similar errors prejudicing a party, while review entails re-examination on merits. On that basis, correction of mistaken party and asset identification, together with consequential directions such as return of equipment and liberty to pursue related claims, was treated as a valid exercise of recall and not an impermissible review.

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Issues: (i) Whether the Resolution Professional had locus to seek recall of the earlier order after approval of the resolution plan, (ii) whether the order dated 09.05.2024 was a valid recall order or an impermissible review in the guise of recall, and (iii) whether the Adjudicating Authority erred in modifying the earlier order while correcting factual mistakes and granting consequential reliefs.

Issue (i): Whether the Resolution Professional had locus to seek recall of the earlier order after approval of the resolution plan.

Analysis: The dispute was held to be governed by the settled principle that the Resolution Professional is not rendered functus officio merely because the CIRP has concluded, where the application concerns matters that survive or arise from the insolvency process and where the application was instituted during CIRP and continued through the implementation stage. The authority to act for the corporate debtor and the monitoring arrangement were treated as sufficient to sustain the application.

Conclusion: The Resolution Professional had locus to maintain the recall application.

Issue (ii): Whether the order dated 09.05.2024 was a valid recall order or an impermissible review in the guise of recall.

Analysis: The distinction between recall and review was applied: recall is available to correct a mistake, procedural irregularity, or comparable error prejudicing a party, whereas review involves re-examination on merits and is not inherent. The modifications were found to flow from correction of factual mistakes in the earlier order, including mistaken identification of parties and assets, rather than from a fresh merits reappraisal.

Conclusion: The order dated 09.05.2024 was held to be a valid recall order and not a review.

Issue (iii): Whether the Adjudicating Authority erred in modifying the earlier order while correcting factual mistakes and granting consequential reliefs.

Analysis: The corrected findings regarding possession of the engine and APU, the identity of the concerned party, and the consequential directions on return and related claims were treated as arising from rectification of mistakes already embedded in the earlier order. The consequential adjustments, including liberty to pursue differential or job-work related claims, were held to be within the permissible scope of recall.

Conclusion: The Adjudicating Authority was held not to have erred in passing the impugned order.

Final Conclusion: The appeal was found to lack merit because the impugned order was upheld as a legitimate exercise of recall power correcting factual error and its consequences.

Ratio Decidendi: A tribunal may recall its earlier order to correct a mistake of fact or comparable error prejudicing a party, and such correction does not amount to review if it does not entail re-adjudication on merits.

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