TaxTMI 
TaxTMI 
2026 (3) TMI 37
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....shnendu Dutta, Sr. Advocate with Ms. Palak Sharma, Advocates for R-4. ASHOK BHUSHAN, J. JUDGMENT These three appeals have been filed by the suspended director of the corporate debtor challenging the order passed by the adjudicating authority (National Company Law Tribunal, New Delhi Bench, Court - II) in C.P. (IB) 143/ND/2022. 2. Comp. App. (AT) (Ins.) No. 256/2026 has been filed challenging the order dated 21.01.2026 passed in new I.A. No. 312/ND/2026, several other reliefs have been claimed in the appeal. Comp. App. (AT) (Ins.) No. 287/2026 has been filed against the order dated 13.01.2026 passed in new I.A. No. 112/ND/2026. Comp. App. (AT) (Ins.) No. 288/2026 has been filed challenging the order dated 07.01.2026 in RA No. 83/ND/2025 filed by Orbis Trusteeship Services Private Limited, the financial creditor. 3. These three appeals arise out of the same CIRP initiated against the corporate debtor, Nobel Buildtech Private Limited. Brief background facts giving rise to these appeals are: i. Kindle Infraheights Pvt. Ltd. (the principal borrower) raised funds though issuance of secured Non-Convertible Debentures (NCDs) to Asia Pragati Strategic Investment Fund....
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.... was fixed as Rs. 210 crore. Rs. 55 crore was already paid. Rs. 40 crore was paid at the time of execution of the Agreement and Rs. 25 crore was to be paid within 30 days of commencement date and Rs. 90 crore was paid within 90 days of commencement date. vii. Settlement Agreement also contemplated that on consequent of default, financial creditor has right to revive the insolvency proceedings and right to sell the mortgage land until full and final payment of all dues. After settlement dated 09.05.2025, an application under Section 12A was filed before the NCLT for withdrawal of IB 143(ND)/2022. viii. Adjudicating authority held that the Orbis Trusteeship Services Private Limited is a sole financial creditor qua the corporate debtor who has preferred the application under Section 12A, the application was allowed and C.P. (IB) No.143(ND)/2022 is dismissed as withdrawn, which order was passed on 31.07.2025. ix. Order dated 31.07.2025 was uploaded on the website on 26.08.2025. On 28.08.2025, financial creditor issued notice to the principal borrower, corporate debtor and the personal guarantors, communicating that amount of Rs. 25 core is due on 30.08.2025. ....
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....ed of. xiv. By subsequent order 13.01.2026, corporate debtor's application 112/ND/2026 praying for rectification of the order dated 07.01.2026 was disposed of by replacing the word "conceded" with word "agreed to". It was after the aforesaid the corporate debtor filed an application I.A.312/ND/2026 dated 17.01.2026 praying for extension of 90 days to the corporate debtor to make payment to the debenture holder in terms of the order dated 09.05.2025 with other prayers. The prayers made in I.A. 312/2026 is as follows: "a. Grant an extension of 90 (ninety) days to the Applicant/ Corporate Debtor to make payment to the Debenture Holders in terms of the settlement dated 09.05.2025; b. Direct that during the said extended period, the CIRP shall continue only in a facilitative and non-coercive manner, in line with the orders dated 07.01.2026 and 13.01.2026; c. Permit the Corporate Debtor to complete investor due diligence, obtain requisite debenture holder authorisations, and effect payment in a legally compliant manner; and d. Pass such other or further orders as this Hon'ble Tribunal may deem fit in the interest of justice." xv. In t....
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.... 31.07.2025 on an application filed under Section 12A by the financial creditor itself. It is submitted that amount of Rs. 55 crore was already paid and further amount of Rs. 40 crore was paid on the execution of the Settlement. Further amount of Rs. 25 crore was also paid, although with little delay. Amount outstanding was only Rs. 90 crore for which corporate debtor has made all its efforts, the Noida Authority were approached for accepting a co-developer, which Noida Authority accepted the proposals made. It is submitted that due to original titles not being available, the investor backed out. The monetisation plan could not be fructified. The appellant has bona fide making all efforts to pay the balance amount of Rs. 90 crore but due to facts beyond the control of the corporate debtor amount could not be paid. It is submitted that Restoration Application 83/2025 was filed alleging non-payment of Rs. 25 crore, which was the basis of the application, which amount having been paid and accepted very basis of Restoration Application was unfounded. The financial creditor proceeded to press the said application which was ultimately allowed on 07.01.2026. It is submitted that financial....
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....ity was given to the corporate debtor to make the payment of settlement amount as per settlement terms. Amount of Rs. 25 crore was to be paid within 30 days of the commencement date. Commencement date being the date on which the order was passed by the adjudicating authority for making withdrawal of the CIRP. Corporate debtor committed breach in not making payment on 30.08.2025. As per settlement agreement, consequence of default is provided in clause 2, which provides that any default in payment of any tranche of settlement amount will result in immediate termination of the Agreement. On non-payment of the tranche which was payable by 30.08.2025, Settlement Agreement has been terminated. It is submitted that formerly the Settlement Agreement has now been terminated by email dated 22.01.2026. It is submitted that on default having been committed by the corporate debtor in making the payment as per the Settlement Agreement, adjudicating authority has rightly revived the CIRP proceedings vide order dated 07.01.2026. Order dated 07.01.2026 is a consent order, where the counsel for the corporate debtor conceded/agreed for revival of the CIRP, hence no appeal can be filed against the co....
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....d now the amount due is not Rs. 90 crore rather full amount is due and payable to the financial creditor. 9. Learned Sr. counsel appearing for the respondent No. 4 also reiterated the above submissions. 10. We have considered the submissions of the counsel for the parties and perused the records. 11. It is an admitted fact that financial creditor and the corporate debtor and other group companies and personal guarantors have settled their disputes and Settlement Agreement was entered between the principal borrower, corporate debtor, personal guarantors, Orbis Trusteeship Services Pvt. Ltd. and Standard Capital Markets Limited, the prospective debenture holders and the buyers who were to acquire the shareholding of the Nobal Buildtech Private Limited. Settlement amount was fixed as Rs. 210 crore as full and final settlement. The tranches for payment have been noticed in clause 1(C) of the Settlement Agreement, which is as follows: "1. Settlement Payment Terms C. The Sikka Group Shall make payments in the following trenches towards the Settlement Amount: S. No. Date Amount (in INR Crore) 1. Amount already Paid 55 2. At the time of ex....
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.... is issued on behalf of and for the benefit of the Debenture Holders and is without prejudice to all their rights, remedies and entitlements in law and in equity Yours faithfully," 14. The above letter was immediately replied by corporate debtor, pleading that 30 days' timeline would commence from date from 26.08.2025, on which date the order was uploaded. Reply to legal notice was given in following manner: "To Date: 29.08.2025 Orbis Trusteeship Services Pvt. Ltd. 4A, Ocus Technopolis Sector-54. Golf Club, Gurgaon-122002 Subject: Reply to Legal Notice dated 28.08.2025 regarding Second Tranche under Settlement Deed Dear Sir(s), We write in response to your Notice dated 28.08.2023 demanding payment of the second tranche under the Settlement Deed executed between the Companies. At the outset, we wish to reaffirm our commitment to the settlement and to its timely implementation. The first tranche has already been paid in time, which demonstrates our bona fides and intent to fully comply with the agreed terms. With respect to the second tranche, the Settlement Deed clearly pro....
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....nal financing documents and law, "including the right to revive the insolvency proceedings", until full and final payment of all dues is received. In other words, upon a default, the entire settlement stands vitiated and the Financial Creditor's enforcement rights are fully restored, as if no compromise had been reached (save that any part payments already made are to be adjusted against the total liability)." 16. Appellant's case is that amount of Rs. 25 crore on breach of which RA 83/2025 was filed, was subsequently paid and received by the financial creditor, which fact is not disputed. It is an admitted case of the parties that now only an amount of Rs. 90 crore is due, which has not been paid. 17. By order dated 07.01.2026 adjudicating authority has allowed the application RA 83/2025, however, while allowing the RA 83/2025, adjudicating authority exercised its jurisdiction under Rule 11 of the NCLT Rules, 2016 extended for a period of limited 10 days during which period RP was to hold back and will not proceed with CIRP except to the extent of procuring the documents leading by its ex-management in its endeavour to implement the Settlement. It is useful to notice fol....
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....documents referred to herein above or duplicate thereof would not be sine qua non for payment of balance amount within 10 days from today. We expect the RP to act promptly in the direction of procurement of documents/ duplicates thereof (ibid). Subject to aforementioned, the application stand disposed of..." 19. It was after 07.01.2026, IRP issued notice to the suspended director and the financial creditor. Financial creditor has informed RP that first charge holder is the Greater Noida and it had not received the original documents. RP has made endeavour and obtained copy of the lease deed from the Noida Authorities. The application 312/2025 was filed by the corporate debtor, giving events and facts subsequent to the order dated 07.01.2026. It was pleaded by the corporate debtor that corporate debtor all times have cooperated with the IRP. IRP, after the order dated 07.01.2026 has approached procured the certified copy of the lease did in respect of the project. In paragraphs 5 & 6 of the application, following has been pleaded: "5. That in the continuum of steps undertaken pursuant to the orders of this Hon'ble Tribunal, the process of regularisation and verification ....
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....01.2026 has filed Comp. App. (AT) (Ins.) No. 256/2026, as noted above. 22. In the present appeals, one of the important facts relevant to notice is that financial creditor i.e., Orbis Trusteeship Services Pvt. Ltd. is only financial creditor in the CIRP of the corporate debtor, which facts have been noted while allowing the 12A application filed by the Orbis Trusteeship Services Pvt. Ltd. in its order dated 31.07.2025. Orbis Trusteeship Services Pvt. Ltd. is the financial creditor of the corporate debtor. Hon'ble Supreme Court had occasion to consider the pivotal role to be played by the financial creditor in the CIRP resolution of the corporate debtor. In this context, we need to notice the judgement of the Hon'ble Supreme Court in the matter of 'Swiss Ribbons Private Limited & Anr.' Vs. 'Union of India & Ors.' reported in [(2019) 4 SCC 17]. Hon'ble Supreme Court in the above case had considered the legislative scheme under Sections 7, 8 & 9 of the IBC and other related issues. Hon'ble Supreme Court held that the primary focus of the legislation is to ensure revival and continuation of the corporate debtor. In paragraph 28 of the judgement, following has been laid down: ....
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....te its business; and who has specified repayment schedules with default consequences. The most important feature, as this Court has said, is that a financial creditor is, from the very beginning, involved in assessing the viability of the corporate debtor who can, and indeed, engage in restructuring of the loan as well as reorganisation of the corporate debtor's business when there is financial stress. Hence, a financial creditor is not only about in terrorem clauses for repayment of dues; it has the unique parental and nursing roles too. In short, the financial creditor is the one whose stakes are intrinsically interwoven with the well-being of the corporate debtor." 25. It is also relevant to notice that in Supreme Court in [(2022) 3 SCC 161] in the matter of 'E.S. Krishnamurthy & Ors.' Vs. 'Bharat Hi-Tecch Builders Private Ltd.' has held that settlement have to be encouraged because the ultimate purpose of the IBC is to facilitate the continuation and rehabilitation of the corporate debtor. In the above case, Section 7 application which was filed for initiating CIRP by the financial creditor was not admitted and adjudicating authority directed the respondent to settle the....
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....ontinued. We have already noted the pleadings in I.A.312/2026, where it was pleaded that process of regularisation and verification of title documents and completion of investor led due diligence is presently underway. Reasonable and limited period was required to enable the proposed investor to complete its internal approvals and to facilitate infusion of funds. Adjudicating authority in the order dated 21.01.2026 although has not adverted to the pleadings in the application and facts pleaded, however granted limited protection for a period of two weeks. We are of the view that appellant has made out a case for grant of period of 90 days as prayed in I.A.312/ND/2026 to implement the settlement by paying the balance of Rs. 90 crore. 28. Adjudicating authority itself has permitted withdrawal of CIRP vide order dated 31.07.2025 settlement was entered, which appellant is claiming to implement. The reason regarding non-availability of the title deeds was also noted and pleaded before the adjudicating authority, which title deeds have now been procured as submitted by the learned counsel for the RP. We, thus are satisfied that sufficient cause was made out in the I.A.312/ND/2026 to g....