The National Company Law Appellate Tribunal has reaffirmed the strict adherence to timelines under the Insolvency and Bankruptcy Code, 2016, holding that a prospective resolution applicant excluded from the final list of eligible bidders cannot be permitted to submit a resolution plan merely on grounds of delay or equity. This ruling reinforces the procedural integrity of the CIRP and clarifies the limits of judicial intervention in commercial decision-making by the Committee of Creditors.
Background & Facts
The Dispute
The dispute arises from the Corporate Insolvency Resolution Process (CIRP) of Fairdeal Supplies Ltd., initiated under the Insolvency and Bankruptcy Code, 2016. The Resolution Professional issued a Form G inviting Expressions of Interest (EOI) from prospective resolution applicants. The Form G specified a clear timeline: the last date for submission of EOI was 17.11.2025, the provisional list of prospective resolution applicants (PRAs) was published on 19.11.2025, and the final list was published on 25.11.2025. The Appellant, Ram Prasad Agarwala, a suspended director of the corporate debtor, was not included in either the provisional or final list of PRAs.
Key Facts
- Form G for EOI was issued with a deadline of 17.11.2025
- Provisional list of PRAs published on 19.11.2025
- Final list of PRAs published on 25.11.2025
- Respondent No. 5 (Bijay Murmuria) did not submit an EOI by the deadline
- Respondent No. 5 filed an application before the Adjudicating Authority on 16.03.2026, seeking condonation of delay and permission to submit EOI and resolution plan
- Resolution Professional rejected the application via email dated 15.03.2026
- Adjudicating Authority passed an order on 18.03.2026, condoning the delay and permitting Respondent No. 5 to participate in the CIRP
- The order directed that the entire CIRP process be completed by 03.04.2026
- Appellant, as a suspended director, challenged the order on grounds of violation of Regulation 39(1)(b) and Regulation 36A of the CIRP Regulations, 2016
Procedural History
- 17.11.2025: Deadline for submission of EOI under Form G
- 19.11.2025: Provisional list of PRAs published
- 25.11.2025: Final list of PRAs published; Respondent No. 5 not included
- 15.03.2026: Resolution Professional rejected Respondent No. 5’s request via email
- 16.03.2026: Respondent No. 5 filed I.A. 362/2026 before the Adjudicating Authority
- 18.03.2026: Adjudicating Authority allowed the application, condoning delay and permitting participation
- 29.04.2026: NCLAT heard the appeal and disposed of it
Relief Sought
The Appellant sought setting aside of the Adjudicating Authority’s order dated 18.03.2026, and a direction that Respondent No. 5 be barred from participating in the CIRP due to non-compliance with the timelines and exclusion from the final list of PRAs.
The Legal Issue
The central question was whether the Adjudicating Authority could condone the delay in submission of an Expression of Interest and permit a person not included in the final list of prospective resolution applicants to submit a resolution plan under the Insolvency and Bankruptcy Code, 2016, in the absence of a fresh invitation by the Committee of Creditors.
Arguments Presented
For the Appellant
The Appellant relied on Comp. App. (AT) (Ins) No. 464 of 2024, Aashdan Properties Private Limited vs Dr. Mamta Binani, arguing that Regulation 39(1)(b) of the CIRP Regulations, 2016 explicitly prohibits the Committee of Creditors from considering any resolution plan from a person whose name does not appear in the final list of PRAs. It was submitted that Regulation 36A empowers the CoC to issue a fresh Form G if it wishes to invite new applicants, but in the absence of such a fresh invitation, no new applicant can be permitted to participate. The Appellant contended that the Adjudicating Authority’s order undermined the statutory framework and encroached upon the commercial wisdom of the CoC.
For the Respondent
The Respondent argued that the interests of value maximization under the IBC required flexibility, and that excluding a potential resolution applicant solely on technical grounds would defeat the objective of the Code. It was submitted that the delay was minimal and that permitting participation would enhance competition and maximize asset value. The Respondent relied on equitable principles and the broad discretionary powers of the Tribunal under Section 60(5) of the IBC.
The Court's Analysis
The NCLAT examined the statutory framework under Regulation 39(1)(b) and Regulation 36A of the CIRP Regulations, 2016. Regulation 39(1)(b) states unequivocally that the Committee of Creditors shall not consider any resolution plan received from a person who does not appear in the final list of prospective resolution applicants. The Tribunal emphasized that this is not a discretionary provision but a mandatory bar.
"Regulation 39(1)(b) of CIRP Regulations, 2016 provides as follows: ... (b) received from a person who does not appear in the final list of prospective resolution applicants; ..."
The Court noted that Regulation 36A permits the CoC to modify the invitation for EOI, including issuing a fresh Form G to invite new applicants. However, the absence of such a fresh invitation means the original timeline and eligibility criteria remain binding. The Tribunal held that the Adjudicating Authority cannot override this statutory bar by invoking equitable considerations or the value maximization objective of the IBC.
The Court distinguished the present case from situations where the CoC itself seeks to revisit eligibility, noting that judicial intervention cannot substitute the CoC’s commercial judgment. The Tribunal further observed that permitting late submissions without a fresh invitation would create uncertainty, discourage compliance, and undermine the predictability of the CIRP process.
The Verdict
The appeal was allowed. The NCLAT set aside the Adjudicating Authority’s order dated 18.03.2026, which had condoned the delay and permitted Respondent No. 5 to participate in the CIRP. The Tribunal directed that Respondent No. 5 shall not be permitted to submit a resolution plan unless a fresh Form G is issued by the Committee of Creditors. The CIRP process shall proceed in accordance with the timelines and eligibility criteria as originally published.
What This Means For Similar Cases
Strict Compliance with Form G Timelines Is Mandatory
- Practitioners must ensure that all EOI submissions strictly adhere to the deadlines specified in the Form G issued by the Resolution Professional
- Any late submission, regardless of merit or potential value, is legally invalid unless a fresh invitation is issued
- Applications seeking condonation of delay under Section 60(5) will not succeed if they contravene Regulation 39(1)(b)
CoC’s Authority Over Eligibility Is Non-Negotiable
- The Committee of Creditors alone has the power to revise eligibility criteria by issuing a fresh Form G
- Adjudicating Authorities cannot override this authority under the guise of equity or value maximization
- Legal challenges to exclusion from the final list must target the CoC’s decision-making process, not the Adjudicating Authority
Judicial Restraint in Commercial Decisions
- Courts and Tribunals must refrain from substituting their judgment for that of the CoC in matters of eligibility and process design
- The IBC’s structure assigns commercial decision-making to the CoC; judicial intervention is limited to procedural compliance
- Practitioners should focus arguments on whether the CoC followed its own published process, not on whether the outcome is "fair"
