Adverse Remarks on Plan Delay Expunged Where Approved Plan Allowed Deferral: NCLAT Principal Bench

The National Company Law Appellate Tribunal expunged adverse remarks and an IBBI reference against a resolution applicant and monitoring committee, holding the approved plan itself permitted deferring payment pending appeals.

The National Company Law Appellate Tribunal (NCLAT) has expunged adverse findings, and a reference to the Insolvency and Bankruptcy Board of India (IBBI), against a successful resolution applicant (SRA), the erstwhile resolution professional and a creditor for delayed implementation of a resolution plan, holding that the approved plan itself deferred payment while appeals were pending [Consortium of Admas Industries Pvt. Ltd. v. Rajan Deshraj Agarwal & Ors., 2026-juristway.com-3394-NCLAT(New Delhi-[PB])-IBC].

Justice Mohammad Faiz Alam Khan, Member (Judicial), wrote the order for a Bench with Naresh Salecha, Member (Technical). The plan for Sristi Hospitality Private Limited was approved on 12 Jul 2024 and was to be implemented by 27 Aug 2024. A suspended director appealed; the NCLAT did not stay implementation. The plan was implemented on 30 Jul 2025, and on 4 Sep 2026 the National Company Law Tribunal (NCLT), Mumbai faulted the SRA and the monitoring committee and referred their conduct to the IBBI.

The NCLT relied on Clauses 10.3 and 10.15, which declare the plan binding and unconditional except for its approval, and held that Clause 5.7(ii) could not make implementation contingent on the outcome of appeals.

The NCLAT read Clause 5.7(ii) as clearly providing that payment would be made within the timeline only if no appeal was pending before it or the Supreme Court, or no stay was granted. The NCLT had approved the plan with that clause and without modification, and had not waived or changed the condition.

On that basis, the SRA “was not obliged to implement the plan” while the appeal was pending, even without a stay. The NCLAT held that the delay had been sufficiently explained and should have been accepted, more so as the plan was fully implemented on 30 Jul 2025. It also noted that the adverse observations were recorded although the SRA was not a party before the NCLT and had no opportunity to explain.

Both appeals were allowed, and the adverse observations and the direction forwarding the matter to the IBBI were expunged.

2026-juristway.com-3394-NCLAT(New Delhi-[PB])-IBC