NCLT Approves ₹33.15 Crore Resolution Plan for Himalayan Mineral Waters; Tax Waivers Subject to Departmental Approval under IBC

NCLT Greenlights ₹33.15 Crore Revival Plan for Himalayan Mineral Waters, Defers on Tax Waivers

Prayagraj, August 12, 2025 – The National Company Law Tribunal (NCLT), Allahabad Bench, has approved a resolution plan of ₹33.15 crore for Himalayan Mineral Waters Private Limited, paving the way for its revival under the Insolvency and Bankruptcy Code, 2016 (IBC). The plan, submitted by Poly Medicure Limited, was approved with an overwhelming 98.76% vote by the Committee of Creditors (CoC).

The bench, comprising Judicial Member Sh. Praveen Gupta and Technical Member Sh. Ashish Verma, ruled that while the plan complies with the IBC, any reliefs and waivers sought from government authorities, including the Income Tax Department, are not automatically granted and must be decided by the respective authorities under applicable laws.

Case Background

The Corporate Insolvency Resolution Process (CIRP) against Himalayan Mineral Waters was initiated on June 3, 2024, by the Jammu and Kashmir Bank. The default stemmed from the invocation of a corporate guarantee extended by Himalayan Mineral Waters for credit facilities availed by Leel Electricals Ltd.

Mr. Bhoopesh Gupta was appointed as the Resolution Professional (RP) to oversee the process. The CoC was constituted with eight unsecured financial creditors, including major banks like State Bank of India, Canara Bank, and Bank of Baroda, with total admitted claims amounting to ₹793.42 crore.

The Resolution Process

The RP invited Expressions of Interest (EOI), which attracted 18 prospective applicants. After due diligence, four resolution plans were submitted by Poly Medicure Limited, Fedders Electric and Engineering Limited, Antartica Properties Company Limited, and Mukesh Kumar Agarwal.

The CoC evaluated the plans based on feasibility, viability, and financial proposals. The plan from Poly Medicure Limited, offering ₹33.15 crore, was ranked highest (H-1) and subsequently put to a vote. On March 3, 2025, the CoC, in its commercial wisdom, approved the plan with a 98.76% majority.

The approved plan allocates ₹40 lakh towards CIRP costs and ₹32.75 crore to the unsecured financial creditors.

Key Directives and Findings of the Tribunal

While approving the plan, the NCLT provided crucial clarifications on several contentious issues raised during the proceedings:

• Tax and Statutory Waivers: The successful resolution applicant, Poly Medicure Ltd., had sought several waivers and concessions, including from the Income Tax Department. The tribunal noted that the Income Tax Department did not appear or file a reply despite being served notice. Consequently, the NCLT clarified that any relief under the Income Tax Act, 1961, is not automatically granted and remains "subject to prior approval of the Competent Authority" under the Act. This reinforces the principle that NCLT cannot grant blanket waivers from statutory obligations governed by other laws.

• Pending Litigation: The tribunal addressed a pending appeal before the NCLAT regarding the distribution of lease rental income. It ruled that the disbursement of this income will be strictly governed by the final order of the NCLAT. However, it upheld the agreement that the successful resolution applicant will pursue the litigation at its own cost.

• Fraudulent Transactions: The court directed Poly Medicure Ltd. to pursue a pending application (IA No. 30/ALD/2025) concerning fraudulent transactions amounting to approximately ₹3.33 crore. Any amount recovered from these proceedings, after deducting expenses, must be distributed among the creditors in the order of priority established under Section 53 of the IBC.

An excerpt from the judgment highlights the court's stance on waivers:

"The reliefs, concessions and waivers sought by the Successful Resolution Applicant will be dealt with strictly in accordance with the applicable laws by the concerned authorities acting under different Acts and Statutes... In absence of any response from the Income Tax Department, any concession relief or waivers under the Income Tax Act, 1961 as sought by the SRA shall be subject to prior approval of the Competent Authority..."

Conclusion and Implications

The approval of the resolution plan marks the conclusion of the CIRP for Himalayan Mineral Waters. The moratorium imposed under Section 14 of the IBC has been lifted, and the management and control will be transferred to Poly Medicure Limited. The Resolution Professional, Mr. Bhoopesh Gupta, has been discharged from his duties, except for those necessary to ensure the plan's implementation.

This judgment is significant as it balances the objectives of corporate revival under the IBC with the jurisdiction of other statutory authorities. It reaffirms that while a resolution plan can provide a "clean slate" from past liabilities, it does not grant an automatic pass on statutory dues or concessions, which must be sought and approved through the proper legal channels.