Resolution plan becomes binding once approved by creditors committee, alternative plans cannot be submitted thereafter

NCLAT Principal Bench dismissed appeal challenging rejection of application to submit alternative resolution plan. Corporate debtor's resolution plan was already approved by Committee of Creditors and pending adjudicating authority's approval. Tribunal held that once CoC approves a resolution plan, it becomes binding inter se parties per SC precedent in Ebix Singapore case, and CoC cannot consider alternative plans. Despite appellant's argument that approved plan became unimplementable due to JV partner withdrawal, NCLAT ruled appellant lacked authority to submit new resolution plan after CoC's binding approval.

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The Appeal was filed challenging the rejection of an application (IA No.4783/2024) by the National Company Law Tribunal, New Delhi, Principal Bench. The key issues considered in the judgment are as follows:ISSUES PRESENTED and CONSIDERED:1. Whether the Appellant, claiming to be a Promoter of the Corporate Debtor, had the authority to submit a Resolution Plan for consideration after the approval of another Resolution Plan by the Committee of Creditors (CoC)Rs. 2. Whether the Application filed by the Appellant, seeking approval of the Resolution Plan submitted by them, was rightly rejected by the Adjudicating AuthorityRs. 3. Whether the judgment relied upon by the Adjudicating Authority in TA (AT) No.134/2021 (Dr. Ravi Shankar Vedam vs. Tiffins Barytes Asbestos and Paints Ltd. & Ors.) was applicable to the present caseRs.ISSUE-WISE DETAILED ANALYSIS:The Tribunal considered the relevant legal framework and precedents, the Court's interpretation and reasoning, key evidence and findings, application of law to facts, treatment of competing arguments, and conclusions as follows:1. The Appellant claimed to be a Promoter of the Corporate Debtor and submitted a Resolution Plan for consideration after the CoC had already approved another Resolution Plan. The Adjudicating Authority rejected the Appellant's application based on the precedent set in TA (AT) No.134/2021.2. The Appellant argued that the precedent relied upon by the Adjudicating Authority was not applicable to the present case as it concerned a shareholder's right to challenge a Resolution Plan approved by the CoC. The Appellant contended that they had the authority to submit a new Resolution Plan for the Corporate Debtor.3. The Respondent, representing the Resolution Professional, argued that the Appellant did not have the authority to submit a new Resolution Plan as the CoC had already approved a Plan which was pending consideration before the Adjudicating Authority.4. The Tribunal examined the facts and legal principles, including the binding nature of a Resolution Plan approved by the CoC as established by the Supreme Court in Ebix Singapore Pvt. Ltd. vs. Committee of Creditors of Educomp Solutions Ltd. The Tribunal concluded that the Appellant's Application was rightly rejected by the Adjudicating Authority as the CoC was bound by the approved Resolution Plan.5. The Tribunal found no merit in the Appeal and dismissed it, stating that the Appellant had no authority to submit a new Resolution Plan after the CoC had already approved one. The Tribunal held that the rejection of IA No.4783/2024 was justified based on the legal principles and facts of the case.SIGNIFICANT HOLDINGS:The Tribunal's core principles established in the judgment include:- The binding nature of a Resolution Plan approved by the CoC.- The lack of authority for an entity to submit a new Resolution Plan after the CoC's approval.- The rejection of the Appellant's Application was upheld as it was not within their jurisdiction to submit a new Resolution Plan.In conclusion, the Tribunal dismissed the Appeal, upholding the rejection of the Appellant's Application by the Adjudicating Authority based on the established legal principles regarding the approval and binding nature of Resolution Plans in insolvency proceedings.

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