Issues: (i) Whether an arbitral award-holder's claim, not lodged in the corporate debtor's CIRP and not included in the approved resolution plan, survives and permits continuation of the challenge to the award; (ii) Whether the amount deposited in court as security for stay of enforcement of the award is refundable to the corporate debtor after approval of the resolution plan.

Issue (i): Whether an arbitral award-holder's claim, not lodged in the corporate debtor's CIRP and not included in the approved resolution plan, survives and permits continuation of the challenge to the award.

Analysis: An amount awarded under an arbitral award constitutes a claim and the award-holder is a creditor under the Insolvency and Bankruptcy Code, 2016. The approved resolution plan binds creditors, while claims not forming part of that plan stand extinguished. The award-holder did not submit its claim to the resolution professional; consequently, its claim was not incorporated in the approved plan. Continuance of the Section 34 challenge could not revive an extinguished claim.

Conclusion: The claim under the arbitral award stood extinguished upon approval of the resolution plan, and the challenge to the award became academic, in favour of the petitioner.

Issue (ii): Whether the amount deposited in court as security for stay of enforcement of the award is refundable to the corporate debtor after approval of the resolution plan.

Analysis: A court deposit required as a condition for stay secures the award amount pending adjudication and does not transfer ownership of the money to the award-holder. Release remains subject to the court's control and may be conditioned or modified. Such deposited funds remain assets of the corporate debtor, notwithstanding custody by the court. Since the underlying award claim was extinguished, no unconditional right to the secured deposit remained with the award-holder.

Conclusion: The deposited amount, together with accrued interest, is refundable to the petitioner, in favour of the petitioner.

Final Conclusion: Approval of the resolution plan eliminated the unsubmitted award claim and preserved the corporate debtor's entitlement to funds deposited merely as security.

Ratio Decidendi: A claim under an arbitral award that is not submitted and incorporated in an approved resolution plan is extinguished, and money deposited in court solely as security for that award remains an asset of the corporate debtor.

Issues: Whether insolvency proceedings initiated on an operational creditor's application could continue after full settlement of the claim, discharge of the only other creditor's claim, and acknowledgment of a pre-existing dispute.

Analysis: The operational creditor's claim was fully and finally settled and it consented without objection to reversal of the admission order. The record also established that the claim concerning transportation charges had been disputed before issuance of the demand notice, particularly regarding the distance measurements forming the basis of billing. The only claim received during the process, relating to provident-fund dues, had also been paid in full. In these circumstances, there was no subsisting creditor claim requiring continuation of the insolvency process.

Conclusion: The operational creditor's insolvency application could not be sustained, as the debt stood settled and a genuine pre-existing dispute existed before the statutory demand notice.

Issues: (i) Whether appointment of a liquidator without considering the Committee of Creditors' unanimous recommendation was sustainable; (ii) Whether the IBBI communication dated 18.07.2023 justified bypassing the recommended insolvency professional; (iii) Whether the objection concerning the appellant's Authorisation for Assignment could sustain the appointment; (iv) Whether progress by the incumbent liquidator and the asserted absence of creditor objection warranted refusal of relief.

Issue (i): Whether appointment of a liquidator without considering the Committee of Creditors' unanimous recommendation was sustainable.

Analysis: Section 34 of the Insolvency and Bankruptcy Code, 2016 treats continuation of the resolution professional as liquidator as the default, subject to the specified grounds for replacement. The unanimous and repeatedly affirmed recommendation of the sole Committee of Creditors member was material to selection of the liquidator. The impugned order referred to the relevant Committee meeting only for fixation of fees and did not acknowledge or address its recommendation of the appellant.

Conclusion: The appointment made without consideration of the Committee of Creditors' unanimous recommendation was unsustainable, in favour of the appellant.

Issue (ii): Whether the IBBI communication dated 18.07.2023 justified bypassing the recommended insolvency professional.

Analysis: The power under Section 34(4) of the Insolvency and Bankruptcy Code, 2016 permits replacement on grounds relating to a particular resolution professional and cannot be transformed into a general exclusion of erstwhile insolvency resolution professionals from appointment as liquidators. In any event, the communication targeting an outgoing interim resolution professional or resolution professional did not apply because the appellant had never held either office in the corporate debtor.

Conclusion: The communication did not furnish a valid basis for appointing another liquidator in place of the appellant, in favour of the appellant.

Issue (iii): Whether the objection concerning the appellant's Authorisation for Assignment could sustain the appointment.

Analysis: The eligibility objection was not part of the reasoning in the impugned order. The material concerning the appellant's AFA was contested, and the appellate record did not permit a conclusive determination of its validity. Regulation 7A of the IBBI (Insolvency Professionals) Regulations, 2016 nevertheless required verification before the appellant assumed charge.

Conclusion: The AFA objection could not sustain the impugned appointment; the appellant's current AFA must be verified by the Adjudicating Authority before assumption of charge.

Issue (iv): Whether progress by the incumbent liquidator and the asserted absence of creditor objection warranted refusal of relief.

Analysis: The incumbent's actions were routine statutory liquidation steps, while realisation of assets had remained stayed shortly after his appointment. Those acts were neither irreversible nor sufficient to override the sole financial creditor's unequivocal, repeated recommendation of the appellant. The completed steps could be adopted by the incoming liquidator, and the incumbent was entitled to appropriate costs and fees for work genuinely performed.

Conclusion: Neither the progress made nor the asserted absence of objection justified retaining the incumbent liquidator, in favour of the appellant.

Final Conclusion: The liquidator's appointment was required to conform to the unanimously expressed commercial decision of the Committee of Creditors, subject to verification of the proposed liquidator's subsisting regulatory authorisation and preservation of valid steps already undertaken.

Ratio Decidendi: A liquidator cannot be appointed by disregarding a unanimous Committee of Creditors recommendation on the basis of a general communication that is outside the confines of Section 34(4) of the Insolvency and Bankruptcy Code, 2016 or factually inapplicable to the recommended professional.

Issues: Whether a creditor that did not challenge the Resolution Professional's classification of its claim as contingent can challenge the approved resolution plan after its implementation.

Analysis: The creditor was informed during the corporate insolvency resolution process that its claim was categorised as contingent, but did not challenge that determination before the Adjudicating Authority. Its subsequent pursuit of modification of an interim stay before another forum did not displace the need to timely contest the claim classification in the insolvency process. The resolution plan was approved and thereafter fully implemented, with the insolvency proceeding closed. An approved and implemented resolution plan cannot be disturbed by claims not timely agitated, since the successful resolution applicant cannot be exposed to fresh or resurrected claims after plan approval.

Conclusion: The challenge to the resolution plan was not maintainable at the post-implementation stage and was decided against the appellant.

Issues: (i) Whether discounted trade receivables acquired by a bank under a TReDS reverse-factoring arrangement constitute financial debt or operational debt; (ii) Whether the alleged erroneous recording of a concession regarding precedent vitiated the impugned order; (iii) Whether a claim filed in an incorrect category required inclusion in the resolution plan despite the creditor's delayed filing in the correct category; (iv) Whether relief could be granted after approval and full implementation of the resolution plan.

Issue (i): Whether discounted trade receivables acquired by a bank under a TReDS reverse-factoring arrangement constitute financial debt or operational debt.

Analysis: Financial debt under Section 5(8) requires disbursal against consideration for the time value of money. Under the TReDS mechanism, suppliers assigned to the bank their pre-existing receivables arising from goods supplied to the corporate debtor after the bank discounted the invoices and paid the suppliers. No funds were disbursed to, or placed at the disposal of, the corporate debtor. The debtor's obligation remained the trade payable for goods received, merely payable to the assignee rather than the suppliers. The discount and charges for delayed payment were compensation for early realisation of trade receivables, not consideration for an independent loan. An assignment does not transform operational debt into financial debt; the financier steps into the suppliers' position as an operational creditor. The claimant's status as a scheduled commercial bank does not alter the substance of the transaction.

Conclusion: The TReDS reverse-factoring claim is operational debt, not financial debt, and the bank is an operational creditor.

Issue (ii): Whether the alleged erroneous recording of a concession regarding precedent vitiated the impugned order.

Analysis: The classification issue was independently determined on merits and reached the same conclusion as the adjudicating authority. Therefore, even assuming that the alleged concession was incorrectly recorded, it had no effect on the outcome.

Conclusion: The alleged error regarding concession does not vitiate the impugned order.

Issue (iii): Whether a claim filed in an incorrect category required inclusion in the resolution plan despite the creditor's delayed filing in the correct category.

Analysis: The resolution professional classified the claim as operational debt and specifically directed filing in the appropriate form. The creditor instead persisted with its financial-creditor claim and filed the operational-creditor claim only after dismissal of its application and after approval of the plan by the committee of creditors. A verifiable claim cannot be said to have been improperly ignored where the creditor did not timely lodge it in the category identified by the resolution professional.

Conclusion: The delayed operational-creditor claim did not require inclusion in the resolution plan.

Issue (iv): Whether relief could be granted after approval and full implementation of the resolution plan.

Analysis: The resolution plan had been approved, fully implemented, payments made, and the monitoring committee dissolved. Reclassification at that stage would unsettle a completed insolvency resolution process, and no ground within the limited scope for challenging an approved plan was established.

Conclusion: No relief capable of disturbing the completed resolution process can be granted.

Final Conclusion: The classification of the bank's TReDS receivables as operational debt remains undisturbed, and the completed resolution process cannot be reopened on that claim.

Ratio Decidendi: A financier acquiring discounted invoices under a TReDS reverse-factoring arrangement, without disbursing funds to the corporate debtor for the time value of money, acquires assigned operational receivables and does not become a financial creditor.

Issues: (i) Whether the Adjudicating Authority had jurisdiction under Section 60(5)(c) of the Insolvency and Bankruptcy Code, 2016 to determine and protect access to a liquidation asset; (ii) Whether the Corporate Debtor had a subsisting prescriptive right of way over the appellants' adjoining land and whether its obstruction was connected with the liquidation process.

Issue (i): Whether the Adjudicating Authority had jurisdiction under Section 60(5)(c) of the Insolvency and Bankruptcy Code, 2016 to determine and protect access to a liquidation asset.

Analysis: Section 60(5)(c) extends to questions of law or fact arising out of or relating to insolvency or liquidation. The disputed obstruction arose after commencement of CIRP and directly affected inspection, saleability and value realisation of land forming part of the liquidation estate. Protection of an existing access right required for liquidation does not amount to creating a fresh civil right or usurping an exclusive statutory forum's jurisdiction.

Conclusion: The application under Section 60(5)(c) was maintainable, in favour of the Liquidator.

Issue (ii): Whether the Corporate Debtor had a subsisting prescriptive right of way over the appellants' adjoining land and whether its obstruction was connected with the liquidation process.

Analysis: The non-agricultural permission of 1999 recorded access from the National Highway through the adjoining blocks. The access was openly and continuously used for approximately two decades without contemporaneous objection, including after the appellants acquired the servient land. The alternate route crossed third-party land and was not a legally secure access. Satellite imagery and the timing of the obstruction supported the finding that the established access was blocked after CIRP in a manner detrimental to value maximisation.

Conclusion: The Corporate Debtor possessed a subsisting right of way under Section 15 of the Indian Easements Act, 1882, and the obstruction was connected with and prejudicial to liquidation, in favour of the Liquidator.

Dissenting Opinion: Justice N. Seshayee considered that a contested prescriptive easement imposes a burden on third-party property and requires proof of a defined route, adverse user as of right, uninterrupted twenty-year enjoyment, and examination of evidence. Such a civil dispute falls outside the Tribunal's summary jurisdiction and must be pursued before a civil court with leave under Section 33(5) of the Insolvency and Bankruptcy Code, 2016.

Final Conclusion: The existing access was validly protected as integral to effective realisation of the liquidation estate, and consequential measures to keep it unobstructed were sustained.

Ratio Decidendi: Section 60(5)(c) of the Insolvency and Bankruptcy Code, 2016 permits protection of a pre-existing access right where post-insolvency obstruction has a direct and proximate nexus with liquidation and asset value realisation.

Issues: (i) Whether the appeal was time-barred and whether a clerical rectification of the original order restarted the appellate limitation period; (ii) Whether the Section 9 application was time-barred, including whether the balance confirmations constituted valid acknowledgments extending limitation; (iii) Whether a pre-existing dispute barred initiation of insolvency proceedings under Section 9.

Issue (i): Whether the appeal was time-barred and whether a clerical rectification of the original order restarted the appellate limitation period.

Analysis: Section 61(2) of the Insolvency and Bankruptcy Code, 2016 permits filing within 30 days, with condonation limited to a further 15 days. Limitation runs from pronouncement of the original order. The subsequent order corrected only the date of pronouncement and made no substantive alteration to the findings; hence it did not create a fresh limitation period. Section 60(6) applies to suits and applications by or against a corporate debtor during moratorium and does not extend the period for an appeal under Section 61. Administrative delay in authorising the appeal could not enlarge the statutory outer limit.

Conclusion: The appeal was barred by limitation; the clerical rectification did not restart limitation.

Issue (ii): Whether the Section 9 application was time-barred, including whether the balance confirmations constituted valid acknowledgments extending limitation.

Analysis: Article 137 of the Limitation Act, 1963 applies to a Section 9 application, and limitation runs for three years from the date of default. The admitted default date was 07.03.2015, whereas the application was filed on 23.09.2021. A valid acknowledgment under Section 18 must be written, proved, unequivocal, and made before expiry of the applicable limitation period. The balance confirmations were unproved and reflected materially inconsistent outstanding amounts; together with the creditor's own inconsistent credit-balance communication, they did not establish an unequivocal acknowledgment of an ascertained liability.

Conclusion: The Section 9 application was time-barred and was not saved by a valid acknowledgment of liability.

Issue (iii): Whether a pre-existing dispute barred initiation of insolvency proceedings under Section 9.

Analysis: Correspondence predating the demand notice recorded objections concerning account reconciliation, set-offs and the correctness of ledger figures. These communications disclosed a genuine and continuing dispute concerning the debt claimed, rather than a spurious, hypothetical or illusory defence. The shifting amounts in the balance confirmations reinforced that the debt was not crystallized.

Conclusion: A genuine pre-existing dispute existed, independently rendering the Section 9 application unsustainable.

Final Conclusion: The operational creditor could not invoke the insolvency process for a stale and disputed claim, and the refusal to commence CIRP remained legally sustainable.

Ratio Decidendi: A clerical rectification that does not substantively modify an insolvency order does not reset appellate limitation, and a Section 9 application cannot proceed where the claim is time-barred or subject to a genuine pre-existing dispute.

Issues: Whether unadjudicated interest and damages under the provident fund law, not determined before commencement of the corporate insolvency resolution process, must be provided for in an approved resolution plan.

Analysis: Provident fund dues may stand excluded from the liquidation estate under Section 36(4)(a)(iii) of the Insolvency and Bankruptcy Code, 2016. However, interest and damages under Sections 7Q and 14B of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952, which had neither been determined nor become final before commencement of the corporate insolvency resolution process, are contingent and uncrystallized liabilities. A resolution plan may make a lump-sum provision for such liabilities in the commercial wisdom of the Committee of Creditors, but absence of such provision does not by itself violate the Insolvency and Bankruptcy Code, 2016. The resolution applicant is entitled to certainty regarding liabilities assumed under the plan, and approval of a Committee-approved plan may be declined only on the limited grounds under Section 30(2) of that Code.

Conclusion: Uncrystallized claims for interest and damages need not be included in the approved resolution plan; exclusion of those claims was valid and the issue is decided against the appellant.

Ratio Decidendi: Unadjudicated statutory interest and damages that remain uncrystallized on the commencement date of the corporate insolvency resolution process are contingent liabilities, and their omission from a Committee-approved resolution plan does not contravene the Insolvency and Bankruptcy Code, 2016.

Issues: Whether a moratorium against the corporate debtor under the Insolvency and Bankruptcy Code, 2016 prevents continuation of a consumer complaint against non-corporate-debtor co-respondents.

Analysis: The statutory moratorium under Section 14 is confined to the corporate debtor and cannot be extended to directors, promoters, associated entities or other respondents unless the statute expressly so provides. As no moratorium protected the co-respondents, their potential liability required adjudication in the consumer complaint. The Commission could not, while acknowledging that liability remained undetermined, foreclose proceedings against them by attributing the alleged deficiency exclusively to the corporate debtor at an interlocutory stage.

Conclusion: The consumer complaint may proceed against the co-respondents notwithstanding the moratorium applicable to the corporate debtor; their liability and objections must be determined on merits by the Commission.

Issues: Whether the ex parte order could be recalled on the ground of non-service of notice and delayed knowledge of the proceedings.

Analysis: Repeated notices and hearing communications had been sent to the appellants' admitted email address and by speed post. The emails had not bounced, and no material rebutted the presumption of receipt. The record also established service of notices and wilful non-participation in the proceedings. The recall application was filed after about 400 days without cogent explanation; no fraud, misrepresentation, or sufficient cause for non-appearance was established. In time-bound insolvency proceedings, such unexplained delay could not be ignored.

Conclusion: Recall of the ex parte order was rightly refused; the finding is against the appellants.

Issues: (i) Whether prior approval of the Adjudicating Authority under the proviso to Section 33(5) of the Insolvency and Bankruptcy Code, 2016 is mandatory before a liquidator institutes legal proceedings for a corporate debtor; (ii) Whether post facto approval validates an arbitration invocation made without such prior approval.

Issue (i): Whether prior approval of the Adjudicating Authority under the proviso to Section 33(5) of the Insolvency and Bankruptcy Code, 2016 is mandatory before a liquidator institutes legal proceedings for a corporate debtor.

Analysis: The proviso expressly requires the liquidator to obtain "prior approval" before instituting proceedings. An arbitration request under Section 21 of the Arbitration and Conciliation Act, 1996 commences arbitral proceedings upon receipt by the respondent. The statutory expression "prior" requires approval to precede the invocation.

Conclusion: Prior approval of the Adjudicating Authority is mandatory before the liquidator invokes arbitration on behalf of the corporate debtor; this finding is against the applicant on the requirement of prior approval.

Issue (ii): Whether post facto approval validates an arbitration invocation made without such prior approval.

Analysis: Unlike Section 28(4) of the Insolvency and Bankruptcy Code, 2016, which expressly renders specified unauthorised actions void, Section 33(5) prescribes no consequence of voidness. The absence of prior approval therefore makes the invocation ineffective, rather than void ab initio. A purposive construction preserves the liquidation estate's recoveries and avoids requiring a fresh invocation with potential limitation consequences. Following approval, the invocation takes effect from the approval date, and subsequent procedural steps must run from that date.

Conclusion: Post facto approval renders the arbitration invocation effective from the date of approval, not from the original notice date; the application was maintainable and this finding is in favour of the applicant.

Final Conclusion: The Section 21 invocation was effective from 23 December 2022, when approval was granted, and a sole arbitrator was appointed to adjudicate the contractual disputes.

Ratio Decidendi: Where Section 33(5) requires prior approval for a liquidator to institute proceedings but does not prescribe voidness for non-compliance, an unauthorised arbitration invocation remains ineffective until approval is granted and is treated as commenced on the approval date.

Issues: Whether the order classifying the petitioner as fraud complied with the requirement of a reasoned order, and whether the bank could be permitted to recommence fraud-classification proceedings for the relevant review period.

Issue (i): Whether the order classifying the petitioner as fraud complied with the requirement of a reasoned order.

Analysis: Clause 2.1.1.4 of the Fraud Master Circular of 2024 requires the bank to serve a reasoned order setting out the relevant facts and circumstances relied upon, the response to the show-cause notice, and the reasons for classification. The impugned order merely reproduced the forensic auditor's observations and recorded the opportunities afforded to the petitioner, without addressing the petitioner's defences or explaining their rejection. Its contents substantially replicated the show-cause notice before declaring the petitioner as fraud.

Conclusion: The fraud-classification order was wholly unreasoned and unsustainable, in favour of the petitioner.

Issue (ii): Whether the bank could be permitted to recommence fraud-classification proceedings for the review period from 1 April 2014 to 4 December 2018.

Analysis: The forensic audit report attributed no fraudulent transaction to the petitioner during his tenure as director. The petitioner had ceased to be a director before the account became an NPA, and the record did not establish that he had executed a personal guarantee. In these peculiar circumstances, fraud proceedings against him for the review period could not be sustained.

Conclusion: The bank was denied liberty to reinitiate fraud-classification proceedings against the petitioner for the specified review period, in favour of the petitioner.

Final Conclusion: The fraud classification lacks a legally sustainable basis and cannot be revived on the forensic audit material relating to the specified review period.

Ratio Decidendi: A fraud-classification order must independently address the noticee's response and state reasons for rejecting it; a reproduction of the show-cause notice and audit observations does not satisfy the requirement of a reasoned decision.

Issues: (i) Whether the prayers for correction of the company master data and removal of purported directors survived after the Ministry's compliance; (ii) Whether writ jurisdiction should be exercised to direct investigation into the alleged fraud despite available statutory remedies and pending proceedings before competent fora; (iii) Whether the order permitting the IRP to take protective measures concerning assets should be recalled where affected third parties had not been heard.

Issue (i): Whether the prayers for correction of the company master data and removal of purported directors survived after the Ministry's compliance.

Analysis: The compliance affidavit established that the names reflected as director and additional director had been removed from the master data. The prior direction requiring the company's status to be shown as under CIRP also addressed the remaining status-related grievance.

Conclusion: The master-data and director-related prayers stood satisfied.

Issue (ii): Whether writ jurisdiction should be exercised to direct investigation into the alleged fraud despite available statutory remedies and pending proceedings before competent fora.

Analysis: The investigation prayer had been rendered infructuous by subsequent restitution and investigative proceedings. Effective remedies were available under the insolvency, anti-money-laundering and company-law regimes, while the CIRP had been revived and the NCLT was already seized of the controversy. In the absence of circumstances warranting departure from the rule of alternative remedy, discretionary writ jurisdiction was not to be exercised.

Conclusion: No writ direction for investigation was warranted; the parties may pursue remedies before the competent statutory fora. This is against the petitioner.

Issue (iii): Whether the order permitting the IRP to take protective measures concerning assets should be recalled where affected third parties had not been heard.

Analysis: The affected applicants were not parties to the writ petition when the asset-protection order was made and had no opportunity of hearing. Further, once the writ petition was not being entertained on merits because alternative remedies were available, interim directions could not continue as the sole final relief.

Conclusion: The asset-protection order could not continue and was vacated. This is in favour of the recall applicants.

Final Conclusion: The surviving controversies concerning investigation, assets and restitution are to be pursued and determined by the competent statutory and judicial fora on their own merits.

Ratio Decidendi: Where an efficacious statutory remedy is available and the writ court declines merits adjudication, it cannot preserve interim relief as the sole final relief; an order materially affecting non-parties without a hearing also violates natural justice.

Issues: (i) Whether the Corporate Debtor was denied a fair opportunity of hearing before admission of the financial creditor's insolvency application. (ii) Whether a pending scheme of compromise and arrangement and ongoing settlement negotiations required deferment of the insolvency application. (iii) Whether pending counterclaims, asserted receivables and commercial viability barred admission upon establishment of financial debt and default.

Issue (i): Whether the Corporate Debtor was denied a fair opportunity of hearing before admission of the financial creditor's insolvency application.

Analysis: The Corporate Debtor had filed pleadings and written submissions and was afforded repeated opportunities to advance oral submissions. Its right to address oral arguments was closed only after it failed to utilise those opportunities, including a further opportunity afforded following a change in Bench composition. The adjudication proceeded on the available pleadings, documents and written submissions rather than ex parte. Fair opportunity does not require indefinite adjournments where a party has adequately participated but fails to argue.

Conclusion: There was no violation of the principles of natural justice and no procedural infirmity in deciding the insolvency application on the record.

Issue (ii): Whether a pending scheme of compromise and arrangement and ongoing settlement negotiations required deferment of the insolvency application.

Analysis: A scheme under Sections 230-232 remains a proposal until approved in accordance with law and made binding. Settlement negotiations and unsuccessful one-time settlement proposals do not create a legal embargo on an insolvency application. The settlement proposal had failed for want of the stipulated upfront payment, and the statutory process could not be kept pending indefinitely upon uncertain future negotiations.

Conclusion: The pending scheme and settlement negotiations did not bar or require postponement of admission of the insolvency application.

Issue (iii): Whether pending counterclaims, asserted receivables and commercial viability barred admission upon establishment of financial debt and default.

Analysis: The jurisdictional enquiry is confined to the existence of financial debt, occurrence of default and completeness of the application. The credit facilities, default, classification of accounts as non-performing assets and acknowledgments through settlement proposals established debt and default. The counterclaim before the debt recovery forum remained undecided and could not displace the established default. Claimed receivables, future arbitral recoveries, commercial viability and business hardship do not override the statutory insolvency framework, which itself provides for resolution while preserving the corporate debtor as a going concern.

Conclusion: Pending counterclaims, prospective recoveries and asserted viability did not preclude admission once financial debt and default were established.

Final Conclusion: The admission of the Corporate Debtor to the corporate insolvency resolution process was legally sustainable, and the connected challenges to the procedural orders furnished no basis for appellate intervention.

Ratio Decidendi: Once financial debt and default are established under Section 7, unapproved compromise proposals, ongoing settlement negotiations, and undecided counterclaims do not ordinarily justify deferral of insolvency admission; adequate repeated opportunities satisfy natural justice even where oral argument is subsequently closed for non-utilisation.

Issues: Whether the application for initiation of insolvency resolution process against the personal guarantor under Section 95 was barred by limitation.

Analysis: The corporate debtor's part-payment on 03.02.2021 was undisputed. Under the deed of guarantee, a part-payment by the borrower bound the guarantor; further, the guarantor's liability was co-extensive with that of the principal borrower. The earlier dismissal of the recovery application for default did not extinguish the underlying debt or make the Section 95 proceeding non-maintainable.

Conclusion: The Section 95 application instituted on 28.09.2023 was within limitation and was maintainable against the personal guarantor.

Issues: Whether gratuity and leave encashment payable to an employee who superannuated during the corporate insolvency resolution process constitute insolvency resolution process costs.

Analysis: Section 5(13) of the Insolvency and Bankruptcy Code, 2016 employs an exhaustive definition of insolvency resolution process costs. Apart from the resolution professional's remuneration, the enumerated categories concern expenses actually incurred by the resolution professional during the insolvency resolution process. Gratuity accrues as a terminal benefit upon cessation of employment and is not an expense incurred by the resolution professional; it is also not equivalent to salary payable for services during the process. Leave encashment likewise cannot be included in insolvency resolution process costs and must be addressed under the resolution-plan framework and payment priority prescribed by the Code.

Conclusion: Gratuity and leave encashment do not form part of insolvency resolution process costs; the issue is decided against the appellant.

Issues: Whether, pending the appeal, suspension of a resolution professional's registration for misconduct alleged in one CIRP could operate across all other assignments without an opportunity of hearing concerning those assignments.

Analysis: The statutory scheme requires Board confirmation for appointment or replacement of a resolution professional, while Regulation 13(7) contemplates communication of disciplinary action to the committees of creditors in other ongoing assignments. The blanket suspension was prima facie disproportionate, undermined the respective committees' statutory role, and affected the appellant's other assignments without a hearing on conduct in those assignments. The appellant established a prima facie case, balance of convenience and irreparable injury. The wider appellate scope under Section 220(7) was left for determination in the main appeal.

Outcome: The suspension was stayed insofar as it barred the appellant from acting in assignments other than the CIRP in which he had been removed; the Board may communicate its order to the respective committees of creditors for their decision.

Issues: (i) Whether the Section 7 application was validly authorised by the partnership firm notwithstanding objections by one surviving partner and the intervention of a deceased partner's legal representative; (ii) Whether the asserted financial debt and default entitled the appellant to initiate insolvency proceedings within limitation.

Issue (i): Whether the Section 7 application was validly authorised by the partnership firm notwithstanding objections by one surviving partner and the intervention of a deceased partner's legal representative.

Analysis: Under the partnership deed, the death of a partner did not dissolve the firm, and a nominee of the deceased partner could join only upon acceptance by the surviving partners. As the legal representative had not been admitted as a partner, he lacked standing to intervene in the insolvency proceeding. Decisions concerning the firm's business could be taken by a majority under the partnership deed and Section 12(c) of the Partnership Act, 1932. The decision of two of the three surviving partners to commence the proceeding was therefore binding. A partner acting in the firm's name could institute the application because each partner is an agent of the firm, and neither Rule 4 nor Form 1 required signatures of every partner. Any challenge to the majority decision lay before the competent civil forum.

Conclusion: The Section 7 application was validly authorised; the objection to its institution fails.

Issue (ii): Whether the asserted financial debt and default entitled the appellant to initiate insolvency proceedings within limitation.

Analysis: The corporate debtor's balance sheets classified the appellant as a sundry creditor, and the ledger and Form 1 showed amounts advanced and repayable by the corporate debtor. Absence of a formal loan agreement or an interest stipulation did not negate the existence of a debt, and the principal amount exceeded the statutory threshold. However, the last transaction was on 31.03.2019, furnishing the nearest ascertainable point for default and limitation. The subsequently asserted default date of 30.05.2022 was unsupported by the record. As the Section 7 application was filed after expiry of the limitation period reckoned from the last transaction, the debt was time-barred.

Conclusion: The Section 7 application was not maintainable because the claim was barred by limitation.

Final Conclusion: Although the initiation of proceedings was duly authorised and the amount constituted a debt, insolvency jurisdiction could not be invoked for a time-barred claim.

Ratio Decidendi: A Section 7 insolvency application founded on an otherwise established financial debt cannot be maintained after expiry of limitation, and an unsupported later date of default cannot extend the limitation period.

Issues: Whether pending civil and arbitral proceedings concerning operational-credit claims, which had not crystallised into determinable and quantifiable claims before approval of the resolution plan, survived the approved resolution plan.

Analysis: The final list of operational creditors quantified the disputed claims at a notional value of Re.1 and did not preserve them subject to the outcome of pending proceedings. The resolution plan, which had attained finality, provided that the settlement corpus available to relevant operational creditors was payable pro rata only for crystallised and approved claims within the stipulated period. Its provisions, read harmoniously, discharged and extinguished pre-effective-date liabilities and required pending proceedings by operational creditors to be withdrawn, abated, settled or extinguished. The clean slate and fresh start principles preclude indeterminate claims from resurfacing after plan approval. There was no ambiguity warranting application of contra proferentem or adoption of a face-value reservation mechanism.

Conclusion: Pending civil and arbitral claims that had not crystallised by approval of the resolution plan stood abated, waived, withdrawn and extinguished; the operational creditors were entitled to no amount beyond their quantified Re.1 claims. The issue is decided in favour of the appellant.