Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2025 Supreme(Online)(SC) 111470

SUPREME COURT
*Bela M. Trivedi, Satish Chandra Sharma, JJ.
Kalyani Transco – Appellant
Versus
Bhushan Power and Steel Limited – Respondent
Civil Appeal No. 1808 of 2020 | Civil Appeal Nos. 2192-2193 of 2020 | Civil Appeal No. 3784 of 2020 | Civil Appeal No. 2225 of 2020 | Civil Appeal No. 3020 of 2020 | Civil Appeal No. 668 of 2021 | Civil Appeal No. 6390 of 2021

Advocates:
For the Appellants/Petitioners: undefined
For the Respondents: undefined

The court emphasized compliance with mandatory timelines and statutory provisions during insolvency resolutions, finding NCLT failures in approving a plan, ruling it invalid and initiating liquidation.

Headnote:(A) Insolvency and Bankruptcy Code, 2016 - Section 12, 29A, 30(2), and 31 - Moot appeals against judgments by NCLAT on resolution plan of a corporate debtor - Court finds that the NCLT failed to comply with mandatory timelines while approving the plan - The plan approved contravened mandatory requirements and was thus rejected - A new appeal was without jurisdiction as it sought to alter unconditioned resolution commitments. (Paras 1-84)

(B) Principles of Law - An approved resolution plan is binding on all parties, including the corporate debtor and resolution applicant, who cannot evade obligations due to procedural delays or litigation - Judicial scrutiny of compliance with statutory provisions is essential to preserve the integrity of the IBC process. (Paras 73-84)

Facts of the case:
A corporate debtor underwent company insolvency resolution process initiated by operational creditors, but resolution applicant failed to implement the approved plan terms - The NCLAT allowed modifications contrary to the original approval process.

Findings of Court:
The NCLAT's orders are deemed coram non judice due to oversteps in jurisdiction, resulting in rejection of the resolution plan and initiation of liquidation processes.

Issues: Examination of adherence to statutory timelines and jurisdiction of appellate authorities concerning resolution plans.

Ratio Decidendi: The court emphasized strict adherence to legislative frameworks, emphasizing both the need for timely resolution and accountability by all stakeholders.

Result: Appeals allowed; NCLT instructed to initiate liquidation.

Table of Content
1. overview of appeals against the nclat order. (Para 1 , 2)
2. arguments from the appellants about their grievances. (Para 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11 , 12)
3. court analysis of the legal standing of parties. (Para 13 , 14 , 15 , 16 , 17 , 18 , 19 , 20 , 21 , 22 , 23 , 24 , 25 , 26)
4. clarification of powers and jurisdiction of the court. (Para 27 , 28 , 29 , 30 , 31)
5. court's detailed examination of compliance with legal requirements. (Para 32 , 33 , 34 , 35 , 36 , 37 , 38 , 39 , 40 , 41 , 42 , 43 , 44 , 45 , 46 , 47 , 48 , 49 , 50 , 51 , 52 , 53 , 54 , 55 , 56 , 57 , 58 , 59 , 60 , 61)
6. final conclusions regarding the resolution plan and compliance. (Para 62 , 63 , 64 , 65 , 66 , 67 , 68 , 69 , 70 , 71 , 72 , 73 , 74 , 75 , 76 , 77 , 78 , 79)
7. conclusion and orders given by the court. (Para 80 , 81 , 82 , 83 , 84 , 85 , 86 , 87)

1. This batch of Appeals stems from the common impugned Judgment and Order dated 17/02/2020 passed by the National Company Law Appellate Tribunal (For short NCLAT), New Delhi in the Company Appeals filed by the various parties.
(I) THE DETAILS AND CATEGORIES OF THE APPEALS: -
(i) Civil Appeal No. 1808 of 2020 has been filed by the Kalyani Transco, an operational creditor of the Corporate Debtor (For short CD) M/s. Bhushan Power and Steel Limited (For short BPSL) challenging the impugned Judgment and Order dated 17/02/2020 passed by the NCLAT in Company Appeal (AT) (Insolvency) No. 1035 of 2019.
(ii) Civil Appeal Nos. 2192-2193 of 2020 have been filed by Mr. Sanjay Singal & Another, the erstwhile promoters of CD challenging the impugned Judgment and Order in Company Appeal (AT) (Insolvency) No. 1034 of 2019 and the Company Appeal (AT) (Insolvency) No. 957 of 2019.
(iii) Civil Appeal No. 3784 of 2020 has been filed by the Government of Odisha & Others challenging the impugned Judgment and Order in Company Appeal (AT) (Insolvency) No. 1461 of 2019.
(iv) Civil Appeal No. 2225 of 2020 has been filed by the Jaldhi Overseas Pte. Limited, an Operational Creditor of CD challenging the impugned Judgment and Order in Company Appeal (AT) (Insolvency) No. 1055 of 2019.
(v) Civil Appeal No. 3020 of 2020 has been filed by M/s. Medi Carrier Private Limited, an operational creditor of CD challenging the impugned Judgment and Order in Company Appeal (AT) Insolvency No. 1074 of 2020.
(vi) Civil Appeal No. 668 of 2021 has been filed by the State of Odisha (was not party before the NCLAT) challenging the impugned Judgment and Order in Company Appeal (AT) (Insolvency) No. 1035 of 2019.
(vii) Civil Appeal No. 6390 of 2021 has been filed by CJ Darcl Logistics Limited, an operational creditor challenging the impugned Judgment and Order in Company Appeal (AT) Insolvency No. 1126 of 2019.

2. (II) FACTUAL BACKGROUND
After the enactment of the Insolvency and Bankruptcy Code, 2016 (IBC), the Banking Regulation Act, 1949 was amended w.e.f. 04/05/2017, to enable the RBI to issue directions to the Indian Banks to mandatorily initiate the Corporate Insolvency Resolution Process (for short CIRP). The RBI vide its Circular dated 13/06/2017, therefore identified 12 big accounts for resolution, infamously known as the "dirty dozen", which included BPSL, constituting about 25% of total non - performing assets in the country, for immediate admission under the IBC. The Factual matrix of the CIRP proceedings against BPSL may be summarized as follows: -
(i) The CIRP proceedings were triggered against BPSL at the instance of Punjab National Bank, which filed a Company Petition being C.A. (IB) No. 202 (PB) of 2017 before the NCLT under the provisions contained in the IBC. The said petition was admitted on 26/07/2017.
(ii) As per S.15 of IBC, the Interim Resolution Professional (IRP) invited claims on 28/07/2017 from all the stakeholders.
(iii) The IRP received various claims, out of which the Resolution Professional admitted claims to the tune of INR 4,72,04,51,78,073.88 (Rupees Forty - Seven Thousand Two Hundred and Four Crores F

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2025 Supreme(Online)(SC) 111470

The court emphasized compliance with mandatory timelines and statutory provisions during insolvency resolutions, finding NCLT failures in approving a plan, ruling it invalid and initiating liquidation.

Cases Referred (2)