TaxTMI 
TaxTMI 
2026 (2) TMI 25
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.... Mr. Amir Arsiwala, Mr. Dhananjay Kumar, Ms. Srideep Bhattacharyya, Mr. Anush Mathkar, Mr. Mehul Kumar, Ms. Aparajita, Advocates for RP. Mr. Pranjit Bhattacharya, Ms. Salonee Shukla, Mr. Sachin Jain, Advocates JUDGMENT Ashok Bhushan, J. These four Appeal(s) have been filed against the same order dated 26.08.2025 passed by National Company Law Tribunal, Mumbai Bench-IV in IA-88/MB/2024 filed under Section 30, sub-section (6) of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as the "IBC"). By the impugned order, the Adjudicating Authority has rejected IA-88/MB/2024 filed for approval of Resolution Plan submitted by the Consortium of Dharmesh Jain, Prakruti Nirman Development Pvt. Ltd., Right Choice Housing Pvt. Ltd. and Nirmal Events and directed to take further steps in accordance with the Code for initiating the liquidation of the Corporate Debtor ("CD"). 2. Company Appeal (AT) (Ins.) No.1521 of 2025 has been filed by the Committee of Creditors ("CoC") of the CD, who had approved the Resolution Plan by 89.2% vote shares, challenging the impugned order. Company Appeal (AT) (Ins.) No.1491 of 2025 has been filed by the Consortium of Dharmesh Jain whos....
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.... The RP also filed applications for extension of Corporate Insolvency Resolution Process ("CIRP") before the Adjudicating Authority, which application was filed by the RP with the approval of the CoC, which extension/ exclusions were allowed by the Adjudicating Authority from time to time. 12th CoC Meeting was conducted on 24.11.2023, which decided to extend the last date for submission of Resolution Plan till 11.12.2023. (vi) On 14.12.2023, the RP received a letter from Bunty Properties, Unit XI proposing to submit a comprehensive Resolution Plan in the CIRP and sought additional time of 12 days. 13th CoC Meeting was held on 15.12.2023. In 14th CoC Meeting held on 29.12.2023, the CoC extended deadline for submission of Resolution Plans for further period of 32 days. (vii) On 17.01.2024, Bunty Properties electronically submitted a Resolution Plan without earnest money deposit and without annexures. 15th CoC Meeting was convened on 18.01.2024, where the CoC voted to extend the last date for submission of Resolution Plan for the CD for a period of 18 days. The CoC also voted to approve the registration of the CD as an MSME. On 24.01.2024, the CD was registered as an....
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....iii) On 10.12.2024, the Adjudicating Authority allowed the extension application, extending the last date for expiry of the CIRP as 30.09.2024. The Adjudicating Authority passed an order on 07.03.2025 asking the SRA to submit an affidavit clarifying the treatment of proceeds, if any, from the fraudulent transactions. The SRA filed the affidavit in compliance of the order dated 07.03.2025. The RP filed an affidavit detailing deviations from the RFRP in the Resolution Plan and served copies to the SRA and the CoC. The Plan application was heard and reserved for orders on 19.03.2025. The Adjudicating Authority thereafter asked for clarification in respect of certain vital points on 22.04.2025. The RP filed an affidavit on 01.05.2025. Further, an additional affidavit was asked from the RP by the Adjudicating Authority vide order dated 02.05.2025, which affidavit was filed by PR on 07.05.2025. (xiv) On 26.08.2025, the Adjudicating Authority passed the impugned order. The Adjudicating Authority in the impugned order held that the Resolution Plan submitted by the SRA is not in compliance with Section 30 sub-section (2) of the IBC as well as Regulation 36A of the Insolvency and Ba....
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.... Datta, learned Senior Counsel appearing for the CoC challenging the impugned order submits that the order of Adjudicating Authority holding that Resolution Plan of the SRA is not in compliance with Section 30 sub-section (20 and CIRP Regulations is incorrect and erroneous. It is submitted that finding of the Adjudicating Authority that name of the SRA was not included in the final list of PRAs published on 10.05.2023, hence, the SRA could not have been considered, is erroneous. It is submitted that Form-G itself contained a Note-2, which authorised the CoC to extend timelines at its sole discretion. Exercising its commercial wisdom, the CoC resolved to entertain several late EOI's including SRA's EoI. The CoC in its different Meetings from time to time extended the timelines. The final list of PRAs for inclusion of the SRA was approved in the 16th CoC Meeting held on 02.02.2024. Inclusion of the SRA in the final list of PRAs was with the resolution of the CoC as per the Form-G itself. The extension of timelines for receiving the EoIs and Resolution Plans is not modification of the terms and conditions of the Form-G, hence, no fresh Form-G was required to be issued. The view of the....
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....hich was allowed on 10.12.2024 by the Adjudicating Authority extending the period till 30.09.2024, hence, the Resolution Plan was approved within the timeline. 7. Shri Abhijeet Sinha, learned Senior Counsel appearing for the SRA submits that extension of timeline is in exercise of CoC's commercial wisdom. Although 11 PRAs had initially submitted the EoI, no eligible Resolution Plan was received and only Plan submitted by Bunty Properties on 17.01.2024, was incomplete and unaccompanied by earnest money deposit. In the 16th CoC Meeting, the EoI submitted by the SRA was duly considered and accepted and pursuant to the direction of the CoC, final list of PRAs was amended by the RP, which included the name of SRA. Thus, the observation of the Adjudicating Authority that name of the SRA was not included in the final list of PRAs, is not correct. The CoC had expressly reserved its power to extend the timelines for submission of the Plan as reflected in Note-2 in Form-G. It is submitted that SRA was fully eligible and it has submitted net-worth certificate of more than Rs.100 crores duly certified by a Chartered Accountant. The CD was duly registered as an MSME. It is submitted that the....
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..... Shri Gautam submits that there are fundamental deficiencies in the resolution process as noted by the Adjudicating Authority. The CIRP was conducted in derogation of the statutory framework governing transparency and equal treatment. Selective waiver of earnest money deposit with regard to performance security has been granted. The Resolution Plan submitted by SRA was not in compliance with Section 30 sub-section (2). The Appellants pray that homebuyers have been waiting for their homes from 2009. This is a fit case where this Tribunal direct for issuance of fresh Form-G to maximize the value of the CD and to ensure that the project is handed over to some genuine SRA, who is inclined and willing to complete the project. 10. Learned Counsel appearing for Nirmal Welfare Association supported the impugned order and submits that CIRP suffers from grave procedural violations and acts of preferential treatment favouring SRA including the unlawful acceptance of belated EoI submitted by SRA on 30.01.2024 was in violation of Regulation 36A(6) of the CIRP Regulations. The SRA was not part of final list of PRAs and was wrongly permitted to submit Resolution Plan, which is in violation of....
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....ord, following are the issues, which arose for consideration in these Appeal(s): (I) Whether SRA, whose name was not included in the final list of PRAs issued on 10.05.2023, could have been permitted to submit a Resolution Plan by the CoC and consideration of the Resolution Plan of the SRA by the CoC is in violation of Regulation 36A and Regulation 39 of the CIRP Regulations? (II) Whether the Resolution Applicant has fulfilled net-worth as provided in the eligibility criteria? (III) Whether the CIRP had already come to an end when Resolution Plan was approved by the CoC? (IV) Whether non-offering of performance security by the SRA, could be a ground to reject the Resolution Plan? (V) Whether CoC granted several relaxations from the provisions of RFRP to SRA, without giving the same benefit to all other PRAs in the final list? (VI) Whether the Resolution Plan is a conditional Resolution Plan on account of stipulation of many assumptions, such as continuance of statutory provisions and license as well as transfer of title of the properties, regardless of Memorandum of Understanding, power of attorney and other documents executed w....
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.... (7) XXXXXXX (8) XXXXXXX (9) XXXXXXX (10) The resolution professional shall issue a provisional list of eligible prospective resolution applicants within ten days of the last date for submission of expression of interest to the committee and to all prospective resolution applicants who submitted the expression of interest. (11) Any objection to inclusion or exclusion of a prospective resolution applicant in the provisional list referred to in sub-regulation (10) may be made with supporting documents within five days from the date of issue of the provisional list. (12) On considering the objections received under sub- regulation (11), the resolution professional shall issue the final list of prospective resolution applicants within ten days of the last date for receipt of objections, to the committee. 36B. Request for resolution plans. - (1) The resolution professional shall, within five days of the date of issue of the final list under sub-regulation (12) of regulation 36A, issue the information memorandum, evaluation matrix and a request for resolution plans to every resolution applicant in the final list: Provided t....
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.... Provided that such modifications shall not be made more than once. (6) The resolution professional may, with the approval of the committee, extend the timeline for submission of resolution plans. (7) The resolution professional may, with the approval of the committee, re-issue request for resolution plans, if the resolution plans received in response to an earlier request are not satisfactory, subject to the condition that the request is made to all prospective resolution applicants in the final list: Provided that provisions of sub-regulation (3) shall not apply for submission of resolution plans under this sub-regulation.] (emphasis added) (ii) In this case, the Applicant issued Form G to invite EOI on 05.04.2023 specifying 26.04.2023 as the last date for submission of EOI. In response to the same, the Applicant received 14 (fourteen) EOls, out of which 3 (three) were found to be ineligible and 11 (Eleven) EOls were found to qualify for the final list of PRAs. The final list of eligible Prospective Resolution Applicants (PRAs) was prepared on 10.05.2023. This was subsequently amended on 07.06.2023, 04.09.2023, and 23.02.2023 to include additional ....
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....ken by the RP and the CoC in the CIRP to answer the above question. 17. Form-G was published by the RP on 05.04.2023. It is useful to extract the entire Form-G, which is filed as Annexure A-4 to the Appeal, which is as follows: "FORM G INVITATION FOR EXPRESSION OF INTEREST (EOI)FOR Nirmal Lifestyle (Kalyan) Private Limited operating in Real Estate Sector at Mumbai (Under Regulation 36A(1) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016) RELEVANT PARTICULARS 1. Name of the corporate debtor along with PAN/ CIN/ LLP No. Nirmal Lifestyle (Kalyan) Private Limited CIN: U70101MH2007PTC169388 2. Address of the registered office NIRMAL LIFESTYLE, OPP. NIRMAL NAGAR, LBS MARG, MU LUND (W), MUMBAI- 400080 3. URL of website https://cirp.nirmalkalyan.com/ 4. Details of place where majority of fixed assets are located Kalyan, Maharashtra 5. Installed capacity of main products/ services Not Applicable 6. Quantity and value of main products/ services sold in last financial year Not Applicable 7. Number of employees/ workmen Under determination (Refer Note 1....
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....cceptance and evaluation by the CoC of any Expression of Interest received subsequent to the issuance of this document shall be subject to the sole discretion of the CoC, subject to Applicable Law. The CoC may at its discretion, reject or further evaluate the interests so received." 19. Another Clause, which needs to be noticed is Clause 2.13.8, which contains heading "Right to consider, accept, disqualify or reject any or all Resolution Plans". In Clause 2.13.8 following is provided: "2.13.8 Subject to Applicable Law, if any EOI or Resolution Plan (with or without EOI) is received by the Resolution Professional from any Person at any stage of the Resolution Plan Process, the Resolution Professional shall be free (but without any obligation to do so) to examine such Resolution Plan (and place the same before the CoC for its consideration) with the approval/consent/ratification of Committee of Creditors and the other PRAs will not have any right to object to submission or consideration of such plan(s). Further, the Resolution Professional (with the approval of CoC) reserves the right to accept any EOI submitted after the Cut-Off Date or any Eol that deviates from the req....
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....ittee of Creditors is hereby provided for evaluating the expression of interests ("Eols") received from prospective resolution applicants viz. Laxmi Civil Engineering Services Private Limited and Satec Envir Engineering (India) Private Limited, including them as a prospective resolution applicant subject to verification of the compliance of such entities with the criteria issued in the invitation for expression of interest issued by the Resolution Professional on April 05, 2023 and other requirements as stipulated under the Code (and regulations thereunder)." Particulars No. of Creditors Value in % Voted in Favour of the Resolution 5 100.00% Voted Against of the Resolution 0 0.00% Abstained from voting on the Resolution 0 0.00% Total 5 100.00%" 22. In the 7th CoC Meeting a resolution was also passed to apply for extension of 60 days for CIRP. In subsequent Meetings of the CoC like 10th Meeting took place on 19.10.2023, 11th Meeting on 27.10.2027 and 12th Meeting on 11.11.2023, where the last date for receiving of the Plans were extended to 11.12.2023. In 13th CoC Meeting held on 15.12.2023, it was noted that no Plan has been received ....
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....the Hon'ble National Company Law Tribunal, Mumbai Bench ("NCLT") vide order dated December 20, 2023 in IAs 5095 of 2023 and 5214 of 2023 in CP(IB) 1337 of 2020. The RP team requested the CoC to deliberate on the total number of days for which extension may be granted to the PRAs. After due discussion and deliberation, the CoC concluded that an additional period up to January 30, 2024 may be provided to the PRAs to submit a resolution plan for the Corporate Debtor, taking into account the last date of CIRP, i.e., February 3, 2024, based on the extension granted by the Hon'ble NCLT. After due discussion, the Coe members may pass the following resolution: "RESOLVED THAT pursuant to Regulation 36 B ( 6) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, approval of the Committee of Creditors is hereby provided for extending the time line for submission of resolution plans by prospective resolution applicants by a further period of 18 (eighteen) days, with the revised last date for submission of resolution plans being January 30, 2024." Particulars No. of Creditors Value in % Vote....
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.... of the board of directors of the Corporate Debtor, whose powers are suspended during the CIRP of the Corporate Debtor. After due discussion, the CoC members may pass the following resolution: "RESOLVED THAT approval of the Committee of Creditors is hereby provided for registration of the Corporate Debtor as a micro, small or medium enterprise in accordance with applicable law. RESOLVED FURTHER THAT pursuant to Section 28(1){h) of the Insolvency and Bankruptcy Code, 2016, approval of the Committee of Creditors is hereby provided for delegating the authority of the resolution professional of the Corporate Debtor to Mr. Chandrakant Shah, a member of the board of directors of the Corporate Debtor, whose powers are suspended as per the provisions of the Insolvency and Bankruptcy Code, 2016, solely for the limited purpose of applying for registration of the Corporate Debtor as a micro, small or medium enterprise in accordance with applicable law." Particulars No. of Creditors Value in % Voted in Favour of the Resolution 4 88.9% Voted Against of the Resolution 0 0.00% Abstained from voting on the Resolution 1 11.1% Total ....
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....ed in Agenda A-6 The Chairman apprised the CoC members that a new expression of interest {"Eol") has been received from a prospective resolution applicant ("PRA") on January 30, 2024. The Chairman apprised the CoC members that per the Invitation for Expression of Interest {"IEOI") issued by the resolution professional ("RP") on April 5, 2023, the last date of submission of EoIs for submission of resolution plan for the Corporate was prescribed to be April 26, 2023. The Chairman also apprised the Coe members that pursuant to clause 2.5.10 of the Request for Resolution Plan issued on May 03, 2023 ("RFRP"), the acceptance and evaluation by the CoC of any EoI received subsequent to the date of issuance of the RFRP (which includes, inter alia. the last date for submission of EoIs as prescribed in the IEOI) shall be subject to the sole discretion of the CoC, subject to the applicable laws and the adjudication of the interlocutory application to be filed by the RP before the Hon'ble National Company Law Tribunal, Mumbai Bench, seeking extension of 60 (sixty) days of the CIRP period of the Corporate Debtor beyond the current last date, being February 3, 2024. The CoC may at it....
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....89.2% vote shares, on the basis of which an application was filed before the Adjudicating Authority for approval of the Resolution Plan by the RP. 27. The question to be answered is as to whether the process adopted by the CoC and the RP to include Consortium of Dharmesh Jain as one of the Resolution Applicant, after approval of the CoC, is in accordance with Regulation 36A and Regulation 39 of the CIRP Regulations. The Adjudicating Authority in the impugned order has observed that consideration of the Plan of SRA was not in accordance with Regulation 36A and Regulation 39, which is the reason given by the Adjudicating Authority for rejecting the application for approval of the Resolution Plan. The Adjudicating Authority has also observed that without publishing the fresh Form-G, EoI from Consortium of Dharmesh Jain could not have been accepted. The submission of Shri Datta in support of the consideration of Resolution Plan of Consortium of Dharmesh Jain is that the Form-G itself contained Note-2, which empowered the CoC to modify the timelines, hence, for modifying the timelines as provided in Form- G, there was no necessity for publication of fresh Form-G. Shri Datta has place....
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....last date for submission of EoI and when we read Clause 6, it does not indicate that for extension of last date of EoI revised fresh Form G was required to be issued. We have noticed that in Regulation 36 B of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 which is 'request for resolution plans' both expressions i.e. modification and extension of timeline have been used. We may refer to sub-regulations (5) and (6) of the Regulation 36B which are as follows:- "36B. Request for resolution plans.- (5) Any modification in the request for resolution plan or the evaluation matrix issued under sub-regulation (1), shall be deemed to be a fresh issue and shall be subject to timeline under sub-regulation (3). [Provided that such modifications shall not be made more than once.] (6) The resolution professional may, with the approval of the committee, extend the timeline for submission of resolution plans. [(6A) If the resolution professional, does not receive a resolution plan in response to the request under this regulation, he may, with the approval of the committee, issue request for re....
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....upport his submission that the name of the SRA did not appear in the final list of PRA. We have noticed above that even though the name of Pinax Paper Mills Private Limited was not included in the first final list of PRAs but after extension of timeline when final list of PRA was published on 28.02.2023, the name of Pinax Paper Mills Private Limited was very much there. Thus, we are not satisfied that there is any breach of provisions of Regulation 39(1-B). The final list published on 28.02.2023 has already been extracted above as is on the record of the Appeal." 28. It was held that any modification in the invitation of EoI required publication of Form-G but Regulation 36A on its term does not contemplate publication of fresh Form-G when timeline has been extended. The above judgment does support the submission of Shri Datta that fresh Form-G was not required to be published since only timelines were extended. 29. We need to notice Regulation 36A to find out the statutory requirement with respect to invitation of EoI and the steps to be taken by the RP in that regard. Regulation 36A provides as follows: "36A. Invitation for expression of interest. (1) The r....
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....orporate debtor's registration status as a micro, small, or medium enterprise in accordance with the Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006). Provided that where the corporate debtor has any real estate project, the committee, for an association or group of allottees in such real estate project, representing not less than ten per cent. or one hundred creditors out of the total number of creditors in a class, whichever is lower, may relax the following: (a) eligibility criteria for submission of expression of interest provided in clause (a) above; and (b) conditions regarding the refundable deposit.] (4A) Any modification in the invitation for expression of interest may be made in the manner as the initial invitation for expression of interest was made: Provided that such modification shall not be made more than once. (5) A prospective resolution applicant, who meet the requirements of the invitation for expression of interest, may submit expression of interest within the time specified in the invitation under clause (b) of sub-regulation (3). (6) The expression of interest received after the ti....
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....e and to all prospective resolution applicants who submitted the expression of interest. (11) Any objection to inclusion or exclusion of a prospective resolution applicant in the provisional list referred to in sub-regulation (10) maybe made with supporting documents within five days from the date of issue of the provisional list. (12) On considering the objections received under sub-regulation (11), the resolution professional shall issue the final list of prospective resolution applicants within ten days of the last date for receipt of objections, to the committee." 30. Regulation 36A sub-regulation 10 provides for issuance of provisional list of eligible PRAs within 10 days from the last date for submission of EoI to the Committee and to all prospective Resolution Applicants, who submitted the EoI. Sub-regulation 11 of Regulation 36A provides for objections for inclusion or exclusion of a PRA within five days and under sub-regulation 12, the RP is to issue final list of PRAs. Coming to the facts of the present case, as noted above, as per Form-G published on 05.04.2023, the 26.04.2023 was the last date for receiving of EoI, 28.04.2023 was the date for issuan....
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....r PRAs will not have any right to object to submission or consideration of such plan(s). Further, the Resolution Professional (with the approval of CoC) reserves the right to accept any EOI submitted after the Cut-Off Date or any Eol that deviates from the requirements set out in the advertisement, and no other PRA/RA shall have the right to object to such acceptance." 31. Clause 2.13.8 begins with the expression "Subject to Applicable Law, if any EoI or Resolution Plan (with or without EoI) is received by RP from any person at any stage of the Resolution Plan Process, the RP shall be free to examine such Plan (and place the same before the CoC for its consideration) with the approval/ consent/ ratification of CoC". There can be no two opinions regarding the power of the CoC as reserved in Clause 2.13.8, but in a case where any EoI is accepted, which is received after expiry of timeline and time is extended by CoC, it is obligatory for the CoC to follow statutory requirement of sub-regulations 10 and 11 of CIRP Regulations 36A. Thus, any EoI received from any person by the RP after the last date of receipt of the EoI, his name has to be included in the PRAs and communicated to a....
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....sue a fresh Form- G and CoC was competent to extend the timeline for receipt of EoIs and Resolution Plans, the statutory requirement in sub-regulations 10, 11 and 12 of Regulation 36A of CIRP Regulations has to be complied with. In the present case, we have looked into all relevant Minutes of the CoC and letters and other correspondence and it is clear that after a request was made to the RP by Consortium of Dharmesh Jain on 30.01.2024, in the Minutes of the Meeting of the CoC held on 02.02.2024, it was decided by the CoC to accept the EoI and to extend the last date for submission of Resolution Plan for the CD. The Resolution Plan given by Consortium of Dharmesh Jain was considered and voted, but it is not shown that after receipt of the EoI from Consortium of Dharmesh Jain on 30.01.2024, any amended list of PRAs for the purpose of inviting objections was published and the compliance was made of sub- regulations 10, 11 and 12 of Regulation 36A. When no provisional list of eligible PRAs, including the name of Consortium of Dharmesh Jain inviting any objections was published, inclusion the name of Consortium of Dharmesh Jain, cannot be said to be in accordance with the statutory req....
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.... We, thus, are of the view that Adjudicating Authority has not held the Consortium of Dharmesh Jain as ineligible to submit the Resolution Plan. Question No.(II) is decided accordingly. Question No.(III) 35. With regard to the observation in the impugned order regarding expiry of CIRP in Paragraph-9.11 it has been observed that Resolution Plan was put to vote from 11.09.2024 to 18.09.2024 and was approved by the CoC and an application for approval of the Plan was filed on 22.10.2024. When the application for extension of CIRP period was allowed by order dated 10.12.2024, the corresponding period till 30.09.2024 when the application for approval of Resolution Plan was filed, was well within the CIRP period. The CoC has submitted that the plan approval application was filed on 30.09.2024, whereas the Adjudicating Authority in the above paragraph has observed that the Plan approval application was filed only on 24.10.2024. Be that as it may, when the Resolution Plan was approved within the CIRP period, no fault can be found with the process on the ground that application for approval of Resolution Plan was filed on 24.10.2024, whereas as noted above, the case of the CoC is that ....