Settlement implementation: limited 90 day extension granted to enable payment and termination of CIRP.

Whether to permit a 90 day extension to implement a bona fide Settlement Agreement was assessed under the Code's rehabilitative objectives, the withdrawal-of-CIRP framework, and the adjudicatory discretion to grant limited interim relief. The Tribunal applied principles favouring preservation and revival of the corporate debtor and encouragement of achievable settlements, noting substantial prior payments, RP assistance in securing title documents, and ongoing investor diligence; it concluded sufficient cause existed and granted the requested 90 day period to complete payment, failing which the withdrawal would not become operative.

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Issues: Whether I.A.312/ND/2026 seeking extension of 90 days to the corporate debtor to implement the Settlement Agreement dated 09.05.2025 (and thereby enable payment of the balance amount and consequent termination of the CIRP) should be allowed.

Analysis: The Tribunal considered the statutory and regulatory framework under the Insolvency and Bankruptcy Code, 2016 and allied rules, including Section 12A (withdrawal of CIRP) and the role of financial creditors as recognised by precedents, together with the adjudicating authority's exercise of discretion under Rule 11 of the NCLT Rules, 2016 to grant limited relief pending revival applications. The facts show a bona fide Settlement Agreement for Rs. 210 crore, part payments totalling Rs. 120 crore already made, asserted difficulties in monetisation due to non-availability of original title deeds, subsequent procurement of certified title documents by the RP, and ongoing investor due diligence. The adjudicating authority had earlier allowed revival but stayed RP action for a limited period; the appellant sought a 90-day period to complete monetisation and payment. Applying the objectives of the Code (preservation and revival of the corporate debtor) and recognising that settlements are to be encouraged where bona fide and achievable, the Tribunal found that sufficient cause existed in the facts and that granting the requested limited extension would further the rehabilitative purpose of the Code without prejudicing creditors, especially given the substantial payments already made and the RP's assistance in obtaining title documents.

Conclusion: I.A.312/ND/2026 is allowed and the order dated 21.01.2026 is modified to grant the corporate debtor a period of 90 days (commencing from the date of this order) to make payment of Rs. 90 crore in terms of the Settlement Agreement; if payment is made within that period, the NCLT order dated 31.07.2025 withdrawing the CIRP shall become operative and the CIRP shall stand terminated. The financial creditor and the RP are directed to render necessary assistance to implement the Settlement Agreement.

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