Status quo must be maintained pending decision, with strict conditions outlined, despite contempt allegations.

O R D E R

This contempt petition is filed at the instance of the employees of the corporate debtor. It has been filed in the Civil Appeal No.10643/2024. It is the case of the contempt petitioners that the alleged contemnor(s)/respondents have Signature Not Verified Digitally signed by willfully disobeyed and violated the judgment and order Nirmala Negi Date: 2025.10.18

10:29:06 IST Reason:

dated 12.09.2024 passed in the said appeal referred to above. The said appeal came to be disposed of by this Court vide order dated 12.09.2024 in the following terms:- “1 Permission to file the appeal without certified/plain copy of the impugned order is granted. A copy of the order which has since been made available was produced during the hearing.

2 The appeal arises from an order dated 6 September 2024 of the National Company Law Appellate Tribunal¹

3 We have heard Mr Mukul Rohatgi and Dr Abhishek Manu Singhvi, senior counsel appearing on behalf of the appellant. Mr Kapil Sibal, Mr C Aryama Sundaram and Mr Dama Seshadri Naidu, senior counsel respectively appeared for the contesting respondents.

4 By the impugned order dated 6 September 2024, the NCLAT has issued the following directions:

“For a period of one week or till the next date, the Resolution Professional will continue to operate the plant as before and the “status quo” as on date, qua the Resolution Professional would be maintained, particularly for all the financial transactions.”

5 Mr Mukul Rohatgi, senior counsel for the appellants submitted that the Committee of Creditors approved the Resolution Plan by a 97% vote on 22 November 2023. The plan was approved by the National Company Law Tribunal on 30 August 2024. According to the appellants, on 31 August 2024, an amount of Rs 3335 crores has been paid to sixteen lenders and possession was taken.

6 The appeal was filed before the NCLAT on 3 September 2024 and the impugned order has been passed on 6 September 2024.

7 During the course of the hearing, reliance has been placed on relevant provisions of the Expression of Interest (EoI) and the Request for

1 NCLAT Resolution Plan (RFRP) documents. Since the proceedings are pending before the NCLAT, we are desisting from making any observation on the interpretation of the conditions on which reliance has been placed by the rival parties. However, prima facie, at this stage we are of the view that the impugned order of the NCLAT suffers from an internal inconsistency in that while on the one hand, the NCLAT directed that for a period of one week or till the next date “the Resolution Professional will continue to operate the plant as before”, at the same time, it directed that “the status quo as on date qua the Resolution Professional would be maintained”.

8 The first part of the above direction indicates that the status quo ante would have to be restored, while the second part of the above direction seems to indicate that the status quo as on date, namely, as on 6 September 2024, would be maintained. The proceedings have been listed before the NCLAT on 18 September 2024.

9 Mr C Aryama Sundaram, senior counsel submitted that an application under Section 12A of the Insolvency and Bankruptcy Code 2016 was filed by a shareholder of the Corporate Debtor. The application was dismissed by the NCLT against which an appeal has been filed.

10 During the course of the hearing, it has been stated on both sides that no adjournment would be sought before the NCLAT and, as a matter of fact, Mr Kapil Sibal, senior counsel for the respondent submitted that should the NCLAT be inclined to pre- pone the hearing, the respondents would be ready and willing to go on with the hearing before the NCLAT.

11 In view of the above backgrou