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Indore Upholds CoC's , Dismisses Union Bank's Plea for Belated EOIs
Trumps Individual Concerns: Indore Rejects Union Bank's Plea
The ), Indore Bench, has dismissed an application filed by seeking to compel the Resolution Professional of to include four in the . The Bench, comprising Judicial Member Brajendra Mani Tripathi and Technical Member Man Mohan Gupta, held that the Committee of Creditors' (CoC) decision to reject the late EOIs, taken by a majority vote, is a reflection of its , which is paramount under the .
Background: The Belated Expressions of Interest
was admitted into CIRP in . , the sole secured financial creditor holding a 23.95% voting share, had sanctioned a ₹30 crore loan secured against 51.79 acres of project land. In , Resolution Professional Chhaya Gupta issued Form-G under , inviting EOIs by . Only two entities—Mr. Sanjay Lunawat and —submitted timely EOIs.
Thereafter, four additional entities—, , , and —submitted complete EOIs after the deadline. The RP rejected them solely on the ground of delay. The matter was placed before the CoC at its 22nd meeting, where a resolution to consider the belated EOIs was put to vote. The resolution secured only 23.73% votes (from Union Bank) and was opposed by 74.89% of the voting share.
Arguments: Value Maximization vs Procedural Rigour
Union Bank argued that excluding financially capable and willing bidders would undermine the IBC's objective of . It contended that —which states that EOIs "shall be rejected" if submitted beyond the timeline—should not be interpreted as an absolute bar, especially since the CIRP had been extended by 90 days to enhance competition. The bank asserted that the CoC had not applied its mind to the potential incremental value the late applicants could bring, and that its own rights as the sole secured creditor would be compromised in a low-competition scenario.
On the other hand, the RP and the majority of the CoC maintained that procedural timelines must be respected and that the of the CoC, exercised by a majority, should not be disturbed. The RP did not file a reply but raised a preliminary objection to maintainability.
Key Observations: The Paramountcy of CoC's Collective Decision
The emphasised that the CoC's is supreme under the IBC and is not ordinarily open to judicial interference. The Bench noted that even if did not operate as an absolute prohibition, the CoC had in its discretion declined to consider the belated EOIs. The Tribunal observed:
"The commercial interest which falls for consideration is not that of the Applicant alone, but of all the creditors of the Corporate Debtor, and it is to be decided by the collective majority. An individual creditor cannot question a decision which has been taken by the majority of the Committee of Creditors."
The Tribunal further held that Union Bank lacked to plead the case of the four prospective applicants, none of whom had approached the Tribunal. The court refused to substitute its own assessment for that of the CoC, reiterating that deference to the CoC's commercial judgment is a cornerstone of the IBC.
The Final Verdict
Dismissing the application, the ruled that the prayers made by Union Bank were not tenable. The decision reinforces the principle that while procedural flexibility may be permissible, the ultimate authority to determine the course of the CIRP rests with the CoC, whose collective decision—reached by the requisite majority—will be respected by the judiciary. The application was disposed of without any order as to costs.
