An e-auction process in liquidation is vitiated if there is a fundamental inconsistency between the E-Auction Sale Notice and the Process Memorandum, or if the timelines provided for bidding are unreasonably short, as this undermines transparency and the objective of value maximization.

ORDER

IA (IBC)/55/2026:

This application has been filed by the Suspended Director under Section 60(5) of the IBC, 2016 and Rule 11 of the NCLT Rules, seeking urgent listing and hearing of IA (IBC)/52/2026.

It is noted that IA (IBC)/52/2026, which has been filed seeking stay of the e-auction dated 12.02.2026, is already listed today. In view thereof, no further relief survives in the present application.

Accordingly, IA (IBC)/55/2026 is dismissed as infructuous.

IA (IBC)/52/2026:

1. This application has been filed by the Applicants/Suspended Directors under Section 60(5) of the IBC, 2016 and Rule 11 of the NCLT Rules, seeking the following prayers:

Main Reliefs:

a. To declare the E-Auction Sale Notice dated 10th January and addendum to the E-Auction Sale Notice dated 28th January 2026 as illegal and invalid;

b. To set aside E-Auction sale of the properties dated 10th January 2026 and Addendum to the E-Auction Sale Notice dated 28th January 2026 issued by the Respondent No.1 / Liquidator, in case the E-Auction has taken place pending disposal of this IA;

C. To direct Liquidator to bear costs on his personal account as he has proceeded with this auction even after being aware of the illegalities and incongruities; and

Interim Reliefs:

a. To stay E-Auction sale of the properties scheduled to be held on 12th February 2026, as per addendum to the E-Auction sale notice issued by the Respondent No.1/Liquidator, dated 28th January 2026, until the disposal of this Application;

b. To direct Liquidator to maintain status-quo in all respects until disposal of this Application.

2. The PCS appearing for the Applicants submitted that the entire e-auction process initiated by the Liquidator is vitiated by serious procedural irregularities and is contrary to the mandatory provisions of the Insolvency and Bankruptcy Code, 2016 and the IBBI (Liquidation Process) Regulations. It was contended that the E-Auction Sale Notice dated 10.01.2026, the Addendum to the E-Auction Sale Notice dated 28.01.2026, and the E-Auction Process Memorandum suffer from inherent legal infirmities, inasmuch as several clauses therein particularly Clauses 9, 9.1, 9.2, 9.3 and Clause 10 at page nos. 96, 97, 98 respectively, are contrary to the prescribed procedure governing e-auction under the IBC and the Liquidation Regulations. The PCS specifically questioned the manner of asset description, reserve price fixation, bid increment mechanism, and the conditions imposed on bidders, submitting that the same undermine transparency, fairness, and value maximization, and are therefore liable to be interdicted by this Adjudicating Authority. Clauses 9, 9.1, 9.2, 9.3 and Clause 10, are reproduced below:

9. ASSETS TO BE AUCTIONED

9.1. The Assets of the Corporate Debtor are being sold on "As is where is", "As is what is", "Whatever there is" and "No recourse basis". The proposed Sale of Assets of the Corporate Debtor does not entail transfer of any other title except the title which the Corporate Debtor had on its Assets as on date of transfer. It is further clarified that the Successful Bidder shall approach the NCLT for any particular relief they would require and specifically but not limited to the relief of the past legal proceedings on the corporate debtor as contemplated u/s 32 A of the IBC, 2016. In case such an application is made to the NCLT, the Liquidator would extend co-operation with the Bidder during the process but the Liquidator