2026 Supreme(Online)(NCLAT) 424

NATIONAL COMPANY LAW APPELLATE TRIBUNAL
Indevar Pandey, Member (T)
Indian Bank – Appellant
Versus
State Bank of India – Respondent
629/ND/2024 COMPANY APPEAL(AT)(INS)

Monitoring Committee cannot alter CoC-approved distribution mechanism for dissenting creditors in resolution plan implementation; must enforce liquidation value computation as per commercial wisdom and Section 30(2)(b).

Headnote:(A) Insolvency and Bankruptcy Code, 2016 - Sections 30(2)(b), 30(4), 53(1), 61 - CIRP Regulations, 2016 - Regulation 38(1)(b), 38(4) - Distribution to dissenting secured financial creditors under approved resolution plan - CoC approved mechanism in 18th and 19th meetings for distribution based on liquidation value attributable to each secured creditor's security interest, appointing evaluation advisor who computed amount for dissenting creditor - Resolution plan incorporating this mechanism approved by Adjudicating Authority - Monitoring Committee cannot alter or modify CoC-approved distribution at implementation stage, as it lacks authority to revisit commercial wisdom of CoC; role limited to supervision and reporting - Direction to pay dissenting creditor computed liquidation value (higher than amount decided by Monitoring Committee) upheld as compliant with statutory minimum and CoC decision, not a premium but entitlement. (Paras 47-73)

(B) Once resolution plan approved by CoC under Section 30(4) and Adjudicating Authority under Section 31, attains finality binding all stakeholders including Monitoring Committee; cannot be tinkered with post-approval. (Paras 59, 66-68)

(C) Dissenting financial creditors entitled to priority payment over assenting creditors, not less than liquidation value under Section 30(2)(b) r/w Section 53(1); distribution mechanism considering security interest valid if approved by CoC. (Paras 60-64)

Facts of the case:
Assenting financial creditors appealed impugned order directing payment of computed liquidation value to dissenting secured financial creditor, challenging Adjudicating Authority's enforcement of CoC-approved distribution mechanism against Monitoring Committee's reduced payment decision during resolution plan implementation of corporate debtor with steel and auto units.

Findings of Court:
Impugned order upheld; Monitoring Committee's alteration invalid; payment of liquidation value attributable to dissenting creditor's security interest in steel unit directed as per CoC-approved mechanism and evaluation advisor's computation.

Issues: Whether Monitoring Committee can modify CoC-approved distribution mechanism post-plan approval; whether direction to pay computed liquidation value to dissenting creditor violates statutory provisions or grants undue premium; scope of commercial wisdom finality.

Ratio Decidendi: Tribunal ruled that CoC's commercial decision on distribution based on attributable liquidation value, incorporated in approved plan, binding; Monitoring Committee lacks power to alter it, enforcing statutory protections under Section 30(2)(b) without interfering in CoC wisdom.

Result: Appeal dismissed.

Table of Content
1. procedural history and brief facts of cirp. (Para 1 , 2 , 3 , 4)
2. appellants argue against altering coc-approved distribution. (Para 5 , 6 , 7 , 8 , 9 , 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17 , 18)
3. respondent defends coc distribution mechanism enforcement. (Para 19 , 20 , 21 , 22 , 23 , 24 , 25 , 26 , 27 , 28 , 29 , 30 , 31 , 32 , 33 , 34 , 35)
4. distinguishes amit metaliks; claims liquidation value only. (Para 36 , 37 , 38 , 39 , 40 , 41 , 42)
5. summarizes rival contentions on distribution. (Para 44 , 45 , 46 , 47)
6. resolution plan mandates dissenting creditor priority. (Para 48 , 49 , 50)
7. coc approved liquidation value-based distribution. (Para 51 , 52 , 53 , 54 , 55)
8. 20th coc reinforces plan-based payments; sbi steel unit only. (Para 56 , 57 , 58)
9. section 30(2)(b) mandates minimum liquidation value payment. (Para 59 , 60 , 61 , 62 , 63)
10. monitoring committee cannot alter coc-approved plan. (Para 64 , 65 , 66 , 67 , 68)
11. amit metaliks inapplicable; no auto unit overreach. (Para 69 , 70 , 71 , 72)
12. impugned order upheld; appeal dismissed. (Para 73 , 74)

J U D G M E N T

(8^th April, 2026)

INDEVAR PANDEY, MEMBER (T)

The present Appeal has been preferred by Indian Bank, UCO Bank, Bank of Baroda, ICICI Bank Limited and Union Bank of India (collectively, the Appellant Banks), under Section 61 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as Code), assailing the common Judgment and Order dated 05.02.2024 passed by the Ld. Adjudicating Authority (National Company Law Tribunal, Cuttack Bench) in I.A. No. 149/CB/2023, I.A. No. 150/2023 and I.A. No. 285/2023 in CP(IB) No.111/CTB/2020.

2. The I.A. No. 149/CB/2023 was filed by State Bank of India, the dissenting Financial Creditor and Respondent No.1 herein seeking appropriate orders of Adjudicating Authority for setting aside distributions of payments to dissenting Financial Creditors decided in the 4th meeting of Monitoring Committee held on 04.05.2023 being void and contrary to the provisions of Section 30 (2) (b) r/w Section 53 (1) of the Code and to direct to make payment of the amount of Rs. 64.47 crores to the applicant. The I.A. No. 150/2023 was filed by Indrani Patnaik, the Successful Resolution Applicant (SRA) and Respondent No.2 in this appeal, for a declaration that the SRA has complied with the resolution plan dated 27.05.2022 as modified by the addendum dated 29.02.2022 and that the resolution plan stands implemented. The I.A. No. 285/2023 was filed by State Bank of India seeking leave of Adjudicating Authority to amend I.A. No. 149 to bring on record a copy of the resolution plan as approved by the Adjudicating Authority vide order dated 20.03.2023 and also relevant minutes of Monitoring Committee meetings.

3. By the aforesaid impugned order, the Ld. Adjudicating Authority issued directions affecting the distribution of Resolution Plan proceeds to State Bank of India, which was a dissenting secured financial creditor in the Committee of Creditors of the Corporate Debtor, OCL Iron and Steel Ltd. The impugned directions also concern the implementation of the Resolution Plan submitted by M/s Indrani Patnaik, the Successful Resolution Applicant (Respondent No. 2), and impact other stakeholders including Asia Opportunities (III) Mauritius Limited (Respondent No. 3) and Punjab National Bank (Respondent No. 4 – Performa Respondent). The Appellant Banks herein are assenting financial creditors, who had voted in favour of the Resolution Plan and the approved distribution mechanism, and have now challenged the order of the Adjudicating Authority on the grounds that it interferes with the commercial wisdom of the Committee of Creditors.

Brief facts of the case

4. The brief facts of the case are as given below:

i. Indian Bank, being one of the financial creditors, initiated proceedings under Section 7 of the Insolvency and Bankruptcy Code, 2016 against the Corporate Debtor (OCL Iron and Steel Ltd.) and pursuant to an order dated 20.09.202

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