Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2026 Supreme(Online)(NCLT) 276

NATIONAL COMPANY LAW TRIBUNAL
Brajendra Mani Tripathi, Member (J), Man Mohan Gupta, Member (T)
Swati Sanil Sahu – Appellant
Versus
Chaya Gupta Liquidator of Gwalior Polypipes Ltd – Respondent
IA/570(MP)2025 in (MP) CP(IB) 6 of 2019|IA No. 570 of 2025 IN C.P. (IB) No. 06/IND/2019

Advocates:
For the Applicant: Sanjeev Chaudhary, Shubham Budhiraja
For the Financial Creditor: Gaurav Chhabra
For the Respondent: Prayas Ram, Chhaya Gupta, B.M. Maheshwari

E-auction sanctity upheld absent cogent evidence of technical glitch or procedural flaws; higher post-auction offer insufficient to discard valid highest bid approved by stakeholders in time-bound liquidation.

Headnote:(A) Insolvency and Bankruptcy Code, 2016 - Section 60(5) - IBBI (Liquidation Process) Regulations, 2016 - Regulations 32(d), 33, Schedule I Regulation 11 - E-auction in liquidation - Applicant alleged technical glitch preventing participation despite EMD deposit - No cogent evidence like screenshots or error messages produced - Other bidders participated without issue - Auction sanctity upheld; higher post-auction offer insufficient to discard valid highest bid approved by Stakeholders’ Consultation Committee - Liquidation process time-bound; re-auction not warranted absent fraud, collusion or procedural vitiation. (Paras 36, 39, 43)

(B) Liquidation Process - Technical Glitch Allegation - Robust evidence required to substantiate claim of platform failure; mere emails post-auction commencement inadequate when platform functional for multiple participants - Stakeholders’ decision on commercial interests paramount. (Paras 39(v), 39(viii))

(C) Value Maximisation - Balanced with timelines; SCC rejection of higher bid proposal respected unless process flawed at core - Auction concluded >33% above reserve price demonstrates competitiveness. (Paras 39(vii), 42(i))

Facts of the case:
Corporate debtor under liquidation; applicant deposited EMD timely for second e-auction but claimed exclusion due to technical glitch on auction portal, similar to prior auction. Emails sent during auction unread; highest bidder declared successful. Applicant sought quashing of auction, re-bidding or inter-se bidding, offering amount over highest bid. Liquidator denied systemic glitch, noted four participants succeeded; SCC approved proceeding with auction.

Findings of Court:
No evidence establishes technical glitch prevented participation; inability attributable to applicant. Auction validly conducted; no basis to interfere or order re-auction.

Issues: (1) Whether applicant prevented from participating due to technical glitch? (2) Whether e-auction deserves rejection and re-auction ordering?

Ratio Decidendi: Alleged technical glitch unsubstantiated without robust proof; platform functional for others. SCC decision to proceed final; higher subsequent offer no ground to discard valid highest bid absent core flaws like fraud. Time-bound liquidation prioritised over post-facto challenges.

Result: Application dismissed; liquidator permitted to proceed.

Table of Content
1. procedural correction of counsel appearance (Para 1 , 2 , 3)
2. cirp initiation and liquidation order (Para 4 , 5 , 6 , 7 , 8)
3. first e-auction technical glitch resolved (Para 9 , 10 , 11 , 12)
4. second e-auction glitch prevents participation (Para 13 , 14 , 15 , 16 , 17)
5. auction conducted properly with multiple bidders (Para 18 , 19 , 20 , 21 , 22 , 23)
6. applicant's lapse; scc approves proceeding (Para 24 , 25 , 26 , 27 , 28)
7. liquidator consents to re-bid for value maximization (Para 29 , 30 , 31 , 32)
8. technical constraints prevent auction modification (Para 33 , 34)
9. framing issues on glitch and re-auction (Para 35 , 36)

ORDER

1. Present application has been filed under section 60(5) of the Insolvency and Bankruptcy Code,2016 and Rule 11 of the NCLT rules, 2016 seeking following reliefs:

a. To allow the present application.

b. Quash the E-Auction proceedings conducted by the Respondent No. 1 on 06/11/2025 in terms of Auction Notice dated 30/10/2025, c. Direct the Respondent No. 1 to permit the Applicant herein to participate in the further auction proceedings for the sale of Asset in question or in the alternative, d. Permit inter-se bidding between the highest bidder and the Applicant herein in terms of Regulation 11 the Schedule I of the IBBI (Liquidation Process) Regulations, 2016, and e. Pass any such order(s) or further relief(s) which this Hon'ble Tribunal deems fit, just and proper in the peculiar circumstances of the case and in the interest of justice.

The averments made by the Applicant in its application are as follows:

2. The Corporate Insolvency Resolution Process ("CIRP") of Gwalior Polypipes Limited ("Corporate Debtor") was initiated by the Hon'ble National Company Law Tribunal, Indore Bench, vide order dated 01.09.2023 passed in CP (IB) No. 06 of 2019, filed by Kotak Mahindra Bank Ltd. under Section 7 of the Insolvency and Bankruptcy Code, 2016 ("IBC").

3. As no viable resolution plan was received during the CIRP, the Committee of Creditors resolved to liquidate the Corporate Debtor. Accordingly, the Hon'ble Tribunal, vide order dated 07.10.2024, directed liquidation of the Corporate Debtor and appointed Respondent No.1 as the Liquidator. (copy of email dated 07.10.2024 annexed as Annexure P2).

4. In pursuance of the liquidation proceedings, Respondent No.1 conducted the sale of assets of the Corporate Debtor through e-auction. An e-auction was scheduled on 29.08.2025 (1st e-auction), for which the Applicant intended to participate.

5. Prior to the said 1st e-auction, the Applicant faced difficulty in depositing the Earnest Money Deposit ("EMD") due to technical issues encountered during RTGS transfer. The Applicant addressed an email dated 27.08.2025 to Respondent No.1, specifically apprising her of repeated RTGS failures from the Applicant's bank and requesting resolution of the issue as the said date was the last date for depositing the EMD.(copy of email dated 27.08.2025 annexed as Annexure P3).

6. On 28.08.2025, the Applicant again addressed an email to Respondent No.1, enclosing her letter of difficulty along with a letter issued by ICICI Bank, evidencing the technical problem in depositing the EMD and requesting Respondent No.1 to take necessary steps.(copy of email dated 28.08.2025 annexed as Annexure P4).

7. Respondent No.1, vide email dated 28.08.2025, admitted that there was a technical glitch in the EMD submission on the BAANKNET portal and informed that the issue had been placed before the Stakeholders' Consultation Committee ("SCC") for immediate action (copy of email dated 28.08.2025 annexed as Annexure P5).

8. The Liquidator thereafter sought the views of the SCC on the said technical glitch and acknowledged that due to technical errors encountered during the EMD submission process, bidders were unable to complete the payment within the stipulated timeline.

9. Subsequently, the technical glitch was resolved and the Applicant participated in the 1^st E-auction conducted on 29.08.20

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2026 Supreme(Online)(NCLT) 276

NATIONAL COMPANY LAW TRIBUNALBrajendra Mani Tripathi, Member (J), Man Mohan Gupta, Member (T)Swati Sanil Sahu – AppellantVersusChaya Gupta Liquidator of Gwalior Polypipes Ltd – RespondentIA/570(MP)2025 in (MP) CP(IB) 6 of 2019|IA No. 570 of 2025 IN C.P. (IB) No. 06/IND/2019

E-auction sanctity upheld absent cogent evidence of technical glitch or procedural flaws; higher post-auction offer insufficient to discard valid highest bid approved by stakeholders in time-bound liquidation.

NATIONAL COMPANY LAW TRIBUNAL
Brajendra Mani Tripathi, Member (J), Man Mohan Gupta, Member (T)
Swati Sanil Sahu – Appellant
Versus
Chaya Gupta Liquidator of Gwalior Polypipes Ltd – Respondent
IA/570(MP)2025 in (MP) CP(IB) 6 of 2019|IA No. 570 of 2025 IN C.P. (IB) No. 06/IND/2019