GREATER NOIDA INDUSTRIAL DEVELOPMENT AUTHORITY versus PRABHJIT SINGH SONI & ANR.

GREATER NOIDA INDUSTRIAL DEVELOPMENT AUTHORITY versus PRABHJIT SINGH SONI & ANR.

The NCLT has inherent power to recall its approval order under s.60(5) of the IBC and Rule 11 of the NCLT Rules where limited grounds exist (lack of notice, misrepresentation, ex parte proceedings); the appellant had submitted a verifiable claim which the RP/plan failed to acknowledge and to treat as secured by operation of law; the resolution plan therefore did not meet the requirements of s.30(2) read with Regulations 37 and 38 and the approval was set aside and remitted to the COC for re-submission after satisfying statutory parameters.

Parties
Appellant: Greater Noida Industrial Development Authority; Respondent: Prabhjit Singh Soni & Anr.
Jurisdiction
India
Judgment Date
12 February 2024
Procedural Posture
Civil Appeal / Appeal From Nclat; Final Judgment by Supreme Court
Outcome
Appeals allowed; impugned orders set aside
Legal Topics
Recall of Tribunal Order, Inherent Powers of NCLT, Verification of Claims in CIRP, Treatment of Secured Vs Operational Creditors, Judicial Review of Resolution Plan, Limitation
Insolvency and Bankruptcy Law Tribunal Procedure Administrative Law Recall of Tribunal Order Inherent Powers of NCLT Verification of Claims in CIRP Treatment of Secured Vs Operational Creditors Judicial Review of Resolution Plan +1 more

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Parties

Greater Noida Industrial Development Authority

Appellant

Prabhjit Singh Soni & Anr.

Respondent

Procedural Posture

Civil Appeal / Appeal From Nclat; Final Judgment by Supreme Court

Legal Issues

  1. 1 Whether NCLT can recall an order of approval under s.31(1) in exercise of powers under s.60(5) of the IBC
  2. 2 Whether the recall application was time-barred
  3. 3 Whether the resolution plan met requirements of s.30(2) of the IBC read with Regulations 37 and 38 of the CIRP Regulations, 2016

Ratio Decidendi

The NCLT has inherent power to recall its approval order under s.60(5) of the IBC and Rule 11 of the NCLT Rules where limited grounds exist (lack of notice, misrepresentation, ex parte proceedings); the appellant had submitted a verifiable claim which the RP/plan failed to acknowledge and to treat as secured by operation of law; the resolution plan therefore did not meet the requirements of s.30(2) read with Regulations 37 and 38 and the approval was set aside and remitted to the COC for re-submission after satisfying statutory parameters.

Court Disposition

Appeals allowed; impugned orders set aside

Orders

  • Order dated 24.11.2022 of the NCLAT set aside
  • Order dated 04.08.2020 of the NCLT approving the resolution plan set aside