Post-approval consortium change in resolution plan is impermissible where it alters evaluation basis and applicant composition.

In the CIRP resolution plan process, consortium membership, eligibility, feasibility, viability and implementation capability are treated as material evaluation factors. A clause permitting change in consortium operates before approval of the resolution plan, not after approval. Once approval is granted, induction of a new member materially alters the successful resolution applicant, the shareholding structure and the basis of evaluation, and cannot be treated as a mere continuation of the original consortium. The limited scope of judicial review over commercial wisdom does not extend to approving a plan that fails to satisfy statutory and regulatory requirements.

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Issues: Whether, after approval of a resolution plan by the Committee of Creditors, the consortium that submitted the plan could lawfully change its composition by inducting a new member and have the plan re-approved.

Analysis: The resolution process and the request for resolution plan treated consortium membership, eligibility, feasibility, viability, and implementation capability as material components of evaluation. The clause permitting a change in consortium, read in the context of the resolution plan process and the CIRP framework, was held to operate before approval of the resolution plan and not after approval. Once the plan had been approved, a subsequent induction of a new member materially altered the composition of the successful resolution applicant, the shareholding structure, and the basis on which the plan had been evaluated. The change was not directed by the Committee of Creditors during negotiations but was sought by the appellant after approval of the plan, and the re-approved plan was therefore treated as a plan of a reconstituted consortium not contained in the final list of prospective resolution applicants. The Tribunal also held that the limited scope of judicial review over commercial wisdom did not permit approval of a plan that did not satisfy statutory and regulatory requirements.

Conclusion: The change in consortium after approval of the resolution plan was impermissible, and the order remanding the plan for reconsideration was upheld.

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