The , has dismissed a significant legal challenge brought by a consortium of unsuccessful , effectively upholding the of the in the ongoing of . The tribunal’s order marks a decisive stance against attempts to stall time-bound insolvency proceedings through unsubstantiated allegations of bias, procedural impropriety, and collusion against the .
The applicants—a consortium comprising and —had filed an seeking to declare the committee’s voting process, held between , as null and void. The applicants, whose own failed to secure approval, alleged that the , Narender Kumar Sharma, had acted with partiality and failed to facilitate a transparent process. The tribunal’s bench, comprising Judicial Member Mahendra Khandelwal and Technical Member Atul Chaturvedi, scrutinized these claims, ultimately finding no cogent evidence to warrant judicial interference.
Allegations of Bias and Procedural Impropriety
The core of the applicants' grievance rested on a series of claims, including allegations that the deliberately withheld material information to disadvantage them while favoring a competing consortium of ex-promoters. Furthermore, the applicants argued that employees of the had actively engaged in unauthorized canvassing among the members to influence the voting outcome in favor of the rival plan.
According to the applicants, these employees, who remained under the functional control of the during the insolvency process, were acting as agents of bias. However, the categorically denied these assertions, clarifying that the individuals in question were standard employees of the , not his representatives. The tribunal noted that the applicants failed to establish a direct link between these employees' actions and the conduct of the .
Addressing the weight of such allegations, the tribunal observed,
"The allegation of collusion is a serious allegation and cannot be sustained merely on the basis of inference or suspicion in the absence of cogent material demonstrating such collusion."
The bench further clarified that the professional oversight provided by a
during the insolvency resolution process does not imply automatic liability for every action taken by staff who remain employed to ensure the
’s operational continuity.
"The mere fact that the employees of the
continued to work during the
and were subject to the supervision of the
cannot, in itself, lead to an inference that every act allegedly committed by such employees was authorised by or undertaken at the instance of the
."
Scrutiny of the Voting Process and Information Access
The applicants further contended that the voting process was inherently flawed, citing the scheduling of e-voting during the Diwali holiday period, which they claimed prevented widespread participation from homebuyers and other financial creditors. They alleged that the distribution of conflicting compliance reports—one suggesting the plan was compliant and another labeling it as non-compliant—prejudiced the committee’s evaluation of their proposal.
The tribunal rejected these claims, emphasizing that the voting process was conducted through an independent electronic platform in the presence of an authorized representative. The bench noted that while individual creditors may occasionally encounter technical issues, there was no evidence of systemic failure or deliberate disenfranchisement. With the rival plan securing an overwhelming 96.42% voting share from the committee, the tribunal emphasized that the voting outcome remained robust and reflective of the committee’s independent assessment.
Regarding the claims of , the tribunal found that the had provided consistent access to the virtual data room and had addressed multiple queries raised by the applicants. The fact that the applicants were able to submit both an initial and a revised suggested that they had sufficient access to the data required to participate in the competitive process. The court concluded that an applicant’s dissatisfaction with the final outcome did not transform a fair process into a biased one.
Primacy of
The tribunal reiterated the settled legal principle that the decision-making process within a is a matter of , which is generally immune from judicial interference provided the statutory requirements of the have been met. The court maintained that the role of the adjudicating authority is not to substitute its own judgment for that of the creditors, especially when the creditors have performed a comparative assessment of all plans based on financial viability, project completion timelines, and overall benefits to all stakeholders.
As the tribunal noted in its final assessment,
"Participation as a prospective resolution applicant does not confer an entitlement to have one's
accepted or to require the CoC to reconsider its commercial decision merely because the Applicant is dissatisfied with the outcome."
By dismissing the application, the New Delhi bench has reinforced the sanctity of the voting process in insolvency cases, cautioning against the filing of repetitive or speculative challenges. The proceedings surrounding the approval of the successful , which is currently pending before the tribunal under Section 30(6) and , are now expected to continue without the disruption of a fresh voting mandate. The court’s refusal to order a new round of voting ensures that the remains on track, prioritizing the resolution of claims and the eventual revival of the over the grievances of unsuccessful bidders.
Resolution Plan Integrity - Creditor Voting Fairness
