Holding

The Supreme Court held that the NCLT has inherent power under s.60(5) IBC and Rule 11 to recall its order, the recall applications were not time‑barred, and the resolution plan did not satisfy s.30(2) IBC and the relevant regulations, leading to the set‑aside of the approval order and remand of the plan to the COC.

Summary

The Greater Noida Industrial Development Authority (GNIDA) claimed that it had submitted a claim of Rs 43.40 crore as a financial creditor against JNC Construction Ltd., but the resolution professional treated it as an operational creditor and the resolution plan approved by the NCLT omitted its claim and undervalued its dues. GNIDA filed applications under s.60(5) IBC seeking recall of the NCLT’s order approving the plan, alleging lack of notice, ex‑parte proceedings and non‑compliance with s.30(2) IBC read with Regulations 37 and 38. The Supreme Court examined whether the NCLT, as adjudicating authority, could recall its own order, whether the recall applications were time‑barred, and whether the plan satisfied the statutory requirements. Relying on the inherent powers preserved by Rule 11 of the NCLT Rules and the non‑obstante clause in s.60(5), the Court held that the NCLT could recall the order, that the applications were filed within the permissible period, and that the plan failed to meet the requirements of s.30(2) and the regulations. Consequently, the Court set aside the NCLT’s approval order and remitted the plan to the Committee of Creditors for resubmission, allowing GNIDA’s appeals.

Issues considered

Whether the NCLT, exercising powers under s.60(5) IBC, can recall an order of approval passed under s.31(1) IBC.
Whether the application for recall of the order was barred by limitation.
Whether the resolution plan complied with the requirements of s.30(2) IBC read with Regulations 37 and 38 of the CIRP Regulations, 2016.
What relief, if any, the appellant is entitled to.

Legislation cited

Code of Civil Procedure, 1908s. 151
Companies Act, 2013s. 408, s. 409
Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016s. Regulation 11, s. Regulation 12, s. Regulation 13, s. Regulation 14, s. Regulation 19, s. Regulation 21, s. Regulation 22, s. Regulation 23, s. Regulation 24, s. Regulation 25, s. Regulation 26, s. Regulation 27, s. Regulation 28, s. Regulation 29, s. Regulation 30, s. Regulation 31, s. Regulation 32, s. Regulation 33, s. Regulation 34, s. Regulation 35, s. Regulation 36, s. Regulation 37, s. Regulation 38, s. Regulation 7, s. Regulation 8
Insolvency and Bankruptcy Code, 2016s. 30(2), s. 31(1), s. 60(5)
National Company Law Tribunal Rules, 2016s. Rule 11
U.P. Industrial Area Development Act, 1976

Subjects

Inherent power of the TribunalRecall applicationClaim submitted with proofForm not as specified in CIRP RegulationsForm directory not mandatoryAncillary or incidental powerspari materia

Judgment

[2024] 2 S.C.R. 258 : 2024 INSC 102

Greater Noida Industrial Development Authority
v.
Prabhjit Singh Soni & Anr.
(Civil Appeal Nos. 7590-7591 of 2023)

12 February 2024
[Dr. Dhananjaya Y. Chandrachud, CJI, J. B. Pardiwala and
Manoj Misra,* JJ.]

Issue for Consideration
Whether in exercise of powers under s.60(5), Insolvency and
Bankruptcy Code, 2016, the Adjudicating Authority-NCLT can recall
an order of approval passed under s.31(1) of the IBC; whether the
application for recall of the order was barred by time; whether the
resolution plan put forth by the resolution applicant did not meet
the requirements of s.30(2) of the IBC read with Regulations 37
and 38 of the CIRP Regulations, 2016 and; what relief, if any, the
appellant is entitled to.

Headnotes
Insolvency and Bankruptcy Code, 2016 – ss.30(2), 31(1), 60(5)
– The Insolvency and Bankruptcy Board of India (Insolvency
Resolution Process for Corporate Persons) Regulations,
2016 – National Company Law Tribunal Rules, 2016 – r.11 –
Inherent power of the Tribunal – Recall of the order of approval
passed u/s.31(1) – Maintainability of application for recall –
Resolution plan put forth by the resolution applicant, if met
the requirements of s.30(2) r/w Regulations 37 and 38 of the
CIRP Regulations, 2016:
Held: A Court or a Tribunal, in absence of any provision to the
contrary, has inherent power to recall an order to secure the ends
of justice and/or to prevent abuse of the process of the Court –
Neither the IBC nor the Regulations framed thereunder, in any
way, prohibit, exercise of such inherent power – Rather, s.60(5)
(c) which opens with a non-obstante clause, empowers the NCLT
(the Adjudicating Authority) to entertain or dispose of any question
of priorities or any question of law or facts, arising out of or in
relation to the insolvency resolution or liquidation proceedings of
the corporate debtor or corporate person under the IBC – Further,

* Author
[2024] 2 S.C.R. 259

Greater Noida Industrial Development Authority v.
Prabhjit Singh Soni & Anr.

r.11 of the NCLT Rules, 2016 preserves the inherent power of the
Tribunal – In the present case, the grounds taken in the recall
application qualified as valid grounds on which a recall of the
order of approval could be sought– Thus, the recall application
was maintainable notwithstanding that an appeal lay before the
NCLAT against the order of approval passed by the Adjudicating
Authority – Neither NCLT nor NCLAT while deciding the application/
appeal of the appellant took note of the fact that the appellant was
not served notice of the meeting of the Committee of Creditors
(COC); the entire proceedings up to the stage of approval of the
resolution plan were ex-parte to the appellant; the appellant had
submitted its claim, and was a secured creditor by operation of
law, yet the resolution plan projected the appellant as one who
did not submit its claim; and the resolution plan did not meet all
the parameters laid down in s.30(2) read with Regulations 37 and
38 of the CIRP Regulations, 2016 – Also, the Recall Application
was not barred by time – Impugned order set aside – Resolution
plan be sent back to the COC for re-submission after satisfying
the parameters set out by the Code. [Para 50, 52 and 55]
Insolvency and Bankruptcy Code, 2016 – The Insolvency and
Bankruptcy Board of India (Insolvency Resolution Process
for Corporate Persons) Regulations, 2016 – Claim submitted
with proof could not be overlooked merely because it is in
a different Form:
Held: Even if a claim submitted by a creditor against the Corporate
Debtor (CD) is in a Form not as specified in the CIRP Regulations,
2016, the same has to be given due consideration by the IRP or the
RP, as the case may be, if it is otherwise verifiable, either from the
proof submitted by the creditor or from the records maintained by
the CD – A fortiori, if a claim is submitted by an operational creditor
claiming itself as a financial creditor, the claim would have to be
accorded due consideration in the category to which it belongs
provided it is verifiable – The resolution plan disclosed that the
appellant did not submit its claim, when the unrebutted case of the
appellant was that it had submitted its claim with proof – Though,
the record indicates that the appellant was advised to submit its
claim in Form B (meant for operational creditor) in place of Form
C (meant of financial creditor) – But, assuming the appellant did
not heed the advice, once the claim was submitted with proof,
it could not have been overlooked merely because it was in a
different Form – The Form in which a claim is to be submitted
is directory and not mandatory – What is necessary is that the
260 [2024] 2 S.C.R.

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claim must have support from proof – The resolution plan failed
not only in acknowledging the claim made but also in mentioning
the correct figure of the amount due and payable. [Paras 30, 54]
Insolvency and Bankruptcy Code, 2016 – Insolvency and
Bankruptcy Board of India (Insolvency Resolution Process
for Corporate Persons) Regulations, 2016 – Regulation 7,
8, 8-A, 9, 9-A, 12-14, 12A – Corporate insolvency resolution
process under – Discussed.
National Company Law Tribunal Rules, 2016 – r.11 – Inherent
power of the Tribunal – Exercise of – Application for recall,
maintainable on limited grounds:
Held: r.11 of the NCLT Rules, 2016 preserves the inherent power
of the Tribunal – Therefore, even in absence of a specific provision
empowering the Tribunal to recall its order, the Tribunal has power
to recall its order – However, such power is to be exercised
sparingly, and not as a tool to re-hear the matter – A Tribunal or a
Court is invested with such ancillary or incidental powers as may
be necessary to discharge its functions effectively for the purpose
of doing justice between the parties and, in absence of a statutory
prohibition, in an appropriate case, it can recall its order in exercise
of such ancillary or incidental powers – Ordinarily, an application
for recall of an order is maintainable on limited grounds, inter alia,
where the order is without jurisdiction; the party aggrieved with
the order is not served with notice of the proceedings in which
the order under recall has been passed; and the order has been
obtained by misrepresentation of facts or by playing fraud upon the
Court /Tribunal resulting in gross failure of justice. [Paras 48, 50]
Insolvency and Bankruptcy Code, 2016 – s.30(2) – The
Insolvency and Bankruptcy Board of India (Insolvency
Resolution Process for Corporate Persons) Regulations,
2016 – Regulations 37 and 38 – Resolution plan put forth
by the resolution applicant did not meet the requirements
of s.30(2) of the IBC read with Regulations 37 and 38 of the
CIRP Regulations, 2016 – Reasons stated. [Para 54]
Insolvency and Bankruptcy Code, 2016 – s.60 – Companies
Act, 2013 – ss.408, 409 – National Company Law Tribunal
Rules, 2016 – r.11 – Code of Civil Procedure, 1908 – s.151:
Held: s.60 specifies that the Adjudicating Authority in relation
to insolvency resolution and liquidation for corporate persons
including corporate debtors and personal guarantors thereof shall
[2024] 2 S.C.R. 261

Greater Noida Industrial Development Authority v.
Prabhjit Singh Soni & Anr.

be the NCLT having territorial jurisdiction over the place where
the registered office of the corporate person is located – s.60(5)
provides that notwithstanding anything to the contrary contained
in any other law for the time being in force, the NCLT shall have
jurisdiction to entertain or dispose of any application or proceeding
by or against the corporate debtor or corporate person; any claim
made by or against the corporate debtor or corporate person,
including claims by or against any of its subsidiaries situated in
India; and any question of priorities or any question of law or
facts, arising out of or in relation to the insolvency resolution or
liquidation proceedings of the corporate debtor or corporate person
under the IBC – r.11 of the 2016 Rules, framed u/s.469 of the
Companies Act 2013, which is in pari materia with s.151 of CPC,
1908, preserves the inherent powers of the Tribunal. [Paras 40-42]
Insolvency and Bankruptcy Code, 2016 – Insolvency and
Bankruptcy Board of India (Insolvency Resolution Process
for Corporate Persons) Regulations, 2016 – Duties performed
by Resolution Professional – Discussed.
Words and Phrases – Insolvency and Bankruptcy Board of
India (Insolvency Resolution Process for Corporate Persons)
Regulations, 2016 – “a person claiming to be an operational
creditor” in Regulation 7; “a person claiming to be a financial
creditor” in Regulation 8:
Held: Indicate that the category in which the claim is submitted is
based on the own understanding of the claimant – There could be
a situation where the claimant, in good faith, may place itself in a
category to which it does not belong – However, what is important
is, the claim so submitted must be with proof – As to what could
form proof of the debt/ claim is delineated in sub-regulation (2)
of Regulations 7 and 8 of the CIRP Regulations, 2016. [Para 20].

Case Law Cited
Ghanashyam Mishra & Sons (P) Ltd. vs. Edelweiss Asset
Reconstruction Co. Ltd., [2021] 13 S.C.R. 737: (2021)
9 SCC 657; Jaypee Kensington Boulevard Apartments
Welfare Association vs. NBCC (India) Ltd., [2021] 12
SCR 603 : (2022) 1 SCC 401; Manohar Lal Chopra
vs. Rai Bahadur Rao Raja Seth Hiralal, [1962] Suppl.
SCR 450 : AIR 1962 SC 527; Grindlays Bank Ltd. vs.
Central Govt. Industrial Tribunal, [1981] 2 S.C.R. 341:
1980 Supp SCC 420; State of Punjab vs. Davinder Pal
262 [2024] 2 S.C.R.

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Singh Bhullar, [2011] 15 SCR 540 : (2011) 14 SCC
770; New India Assurance Co. Ltd. vs. Krishna Kumar
Pandey, (2021) 14 SCC 683; Budhia Swain vs. Gopinath
Deb, [1999] 2 SCR 1189 : (1999) 4 SCC 396; Union
Bank of India vs. Financial Creditors of M/s Amtek Auto
Ltd. & Ors., Civil Appeal No.4620 of 2023 – relied on.
New Okhla Development Authority vs. Anand Sonbhadra,
[2022] 5 SCR 319 : (2023) 1 SCC 724; RE: Cognizance
For Extension of Limitation, [2021] 2 SCR 640 : (2021)
5 SCC 452 – referred to.

List of Acts
Insolvency and Bankruptcy Code, 2016; The Insolvency and
Bankruptcy Board of India (Insolvency Resolution Process for
Corporate Persons) Regulations, 2016; U.P. Industrial Area
Development Act, 1976; Companies Act, 2013; National Company
Law Tribunal Rules, 2016; Code of Civil Procedure, 1908.

List of Keywords
Inherent power of the Tribunal; Recall application; Claim submitted
with proof; Form not as specified in CIRP Regulations; Form
directory not mandatory; Ancillary or incidental powers; pari materia.

Case Arising From

CIVIL APPELLATE JURISDICTION : Civil Appeal Nos.7590-7591
of 2023
From the Judgment and Order dated 24.11.2022 of the National
Company Law Appellate Tribunal in CAAT (I) No. 867 of 2021 and
IA No. 2315 of 2021
Appearances for Parties

Ravindra Kumar, Sr. Adv, Binay Kumar Das, Vipin Saxena, Ms. Neha
Das, Ms. Priyanka Das Advs. for the Appellant.
Dr. Abhishek Manu Singhvi, Siddharth Bhatnagar, Sr. Advs.,Vardhman
Kaushik, Nishant Gautam, Dhruv Joshi, Abhinav Singh, Mayank
Sharma, Ms. Sanjana Mehrotra, Pracheta Kar, Aditya Sidhra, Nadeem
Afroz, Ajay Kanojia, Ayush Sharma, V M Kannan, G.P. Madaan,
Aditya Madaan, Mrs. Harimohana N, Naresh Kaushik, Mrs. Lalita
Kaushik, Advs. for the Respondents.
[2024] 2 S.C.R. 263

Greater Noida Industrial Development Authority v.
Prabhjit Singh Soni & Anr.

Judgment / Order of the Supreme Court
Judgment
Manoj Misra, J.
1. These appeals under Section 62 of the Insolvency and Bankruptcy
Code, 20161 are directed against the judgment and order2 of the
National Company Law Appellate Tribunal, Principal Bench, New
Delhi3 passed in Company Appeal (AT) (Ins.) No. 867 of 2021 and
I.A. No. 2315 of 2021, whereby the appellant’s appeal against the
order of the National Company Law Tribunal, New Delhi4 dated
05.04.2021 has been dismissed.

2. By the order dated 05.04.2021, NCLT had dismissed two applications
filed by the appellant under Section 60(5) of the IBC, namely:

(a) I.A. No.1380/ 2021, inter alia, to recall the order dated 04.08.2020
passed by NCLT in I.A. No. 2201 (PB)/2020 in Company Petition
No. (IB)-272 (ND)/ 2019; and

(b) I.A. No.344/ 2021, inter alia, questioning the decision of the
Resolution Professional (hereinafter referred to as the RP) in
treating the appellant as an operational creditor and not informing
the appellant about the meetings of the Committee of Creditors5.

Factual Background

3. The appellant being a statutory authority constituted under Section
3 of the U.P. Industrial Area Development Act, 19766 acquired land
for setting up an urban and industrial township. On 28.10.2010, one
of the plots of land acquired by it, namely, Plot No. 01-C, Sector
16C, Greater Noida, District Gautam Budh Nagar, U.P., was allotted,
by way of lease for 90 years, to M/s. JNC Construction (P) Ltd (the

1 IBC
2 Order dated 24.11.2022
3 NCLAT
4 NCLT
5 COC
6 1976 Act
264 [2024] 2 S.C.R.

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Corporate Debtor7) for a residential project, by charging premium,
payable in instalments starting from 29.10.2012 up to 29.04.2020,
after initial moratorium of 24 months, albeit subject to payment of
interest as well as penal interest, while reserving right to cancel the
lease and resume the demised land, subject to certain conditions.
The CD committed default in payment of instalments and was served
with demand cum pre-cancellation notice.

4. A Company Petition No. (IB) 272 (PB)/ 2019 was filed against the CD
for initiating Corporate Insolvency Resolution Process8, which was
admitted on 30.05.2019. Consequent thereto, claims were invited
through a public announcement.

5. Pursuant to the public notice, in the month of January 2020, appellant
submitted a claim of Rs. 43,40,31,951, being unpaid instalments
payable towards premium for the lease. The claim was set up by
the appellant as a financial creditor of the CD.

6. However, the RP treated the appellant as an operational creditor and,
vide e-mail dated 04.02.2020, requested the appellant to submit its
claim in Form B, as an operational creditor of the CD.

7. The appellant did not submit its claim afresh as an operational creditor.
In the meantime, the COC approved a plan which was presented to
the Adjudicating Authority (NCLT) for approval. The NCLT vide order
dated 04.08.2020 approved the same.

8. On getting information through letter dated 24.09.2020 that the plan
has been finalised and approved, on 06.10.2020 the appellant filed
I.A. No.344 of 2021 questioning, inter alia, the resolution plan, the
decision of the RP to treat the appellant as an operational creditor,
and all actions in pursuance thereof. Another I.A. No.1380/2021
was filed on 15.03.2021 seeking, inter alia, recall of the order dated
04.08.2020.

9. In the two applications referred to above, the appellant pleaded,
inter alia, that, --

7 CD
8 CIRP
[2024] 2 S.C.R. 265

Greater Noida Industrial Development Authority v.
Prabhjit Singh Soni & Anr.

(a) there was gross error on part of the RP in treating the appellant as
an operational creditor, particularly, when it had no adjudicatory
power under Regulation 13 of The Insolvency and Bankruptcy
Board of India (Insolvency Resolution Process for Corporate
Persons) Regulations, 20169;

(b) the resolution plan erroneously states that appellant did not
submit a claim when, in fact, it was submitted;

(c) appellant being owner of the land with statutory charge over
assets of the CD ought to have been given top priority for its
dues as a secured creditor;

(d) no opportunity of hearing was given to the appellant by the
COC, and the entire process right up to the approval of the
plan by the Adjudicating Authority was ex parte.

NCLT’s Order

10. The NCLT, vide order dated 5.4.2021, rejected the aforesaid
applications, inter alia, on the ground that, despite lapse of seven
months between the date of filing its claim in January, 2020 and
the date of approval of the plan in August 2020, the appellant took
no steps against the RP for not taking a decision on its claim, even
though it was aware about initiation of the CIRP, and now it is not
permissible to take a decision on the claim application of the appellant
as the CIRP is complete consequent to approval of the plan.

Appeal before NCLAT

11. Aggrieved with the order of the NCLT, the appellant filed an appeal
before the NCLAT, inter alia, on the following grounds:
(i) The appellant was a financial creditor and, therefore, ought to
have been a member of the COC. On account of absence of
the appellant in the COC, the approval of the resolution plan
by the COC and, thereafter, by the NCLT is rendered invalid;

9 CIRP Regulations 2016
266 [2024] 2 S.C.R.

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(ii) By virtue of Sections 1310, 13A11and 1412of the 1976 Act, the
appellant had a charge over the assets of the CD and was
therefore a secured creditor within the meaning of Section
3(30)13 read with Section 3(31)14 of the IBC, yet the resolution
plan does not treat the appellant as a secured creditor;
(iii) The appellant had submitted its claim with proof, yet the appellant
was shown as one who submitted no claim. Additionally, the
appellant was neither informed of the meetings of the COC nor
adequate amount, commensurate to its status as a secured
creditor and owner of the land with statutory rights, was allocated
to it in the resolution plan, which is violative of the provisions
of Section 30(2)15 of the IBC; and

10 Section 13.- Imposition of penalty and mode of recovery of arrears.- Where any transferee makes any
default in the payment of any consideration money or instalment thereof or any other amount due on
account of the transfer of any site or building by the Authority or any rent due to the Authority in respect
of any lease, or where any transfer or occupier makes any default in payment of any amount of fee or
tax levied under this Act the Chief Executive Officer may direct that in addition to the amount of arrears,
a further sum not exceeding that amount shall be recovered from the transferee or occupier, as the
case may be, by way of penalty.
11 Section 13.A- Any amount payable to the Authority under Section 13 shall constitute a charge over the
property and may be recovered as arrears of land revenue or by attachment and sale of property in the
manner provided under Sections 503, 504, 505, 506, 507, 508, 509, 510, 512, 513, and 514 of the Ut-
tar Pradesh Municipal Corporations Act, 1959 [Act 2 of 1959] and such provisions of the said Act shall
mutatis mutandis apply to the recovery of dues of an authority as they apply to the recovery of a tax
due to a Municipal Corporation, so however, that references in the aforesaid Sections of the said Act to
“Municipal Commissioner”, “Corporation Officer” and “Corporation” shall be construed as references to
“Chief Executive Officer” and “Authority” respectively:
provided that more than one modes of recovery shall not be commenced or continued simultaneously
12 Section 14.- Forfeiture for breach of conditions of transfer.- (1) in the case of non-payment of consider-
ation money or any installment thereof on account of the transfer by the Authority of any site or building
or in case of breach of any condition of such transfer or breach of any rules or regulations made under
this Act, the Chief Executive Officer may resume the site or building so transferred and may further
forfeit the whole or any part of the money, if any, paid in respect thereof.
(2) Where the Chief Executive Officer orders resumption of any site or building under sub-section (1)
the Collector may, on his own requisition, cause possession thereof to be delivered to him and may for
that purpose use or causes to be used such force as may be necessary
13 Section 3 (30).- “secured creditor” means a creditor in favour of whom a security interest is created.
14 Section 3(31).- “security interest” means right, title or interest or a claim to a property, created in favour
of, or provided for a secured creditor by a transaction which secures payment or performance of an
obligation and includes mortgage, charge, hypothecation, assignment and encumbrance or any other
agreement or arrangement securing payment or performance of any obligation of any person:
Provided that security interest shall not include a performance guarantee.
15 Section 30. Submission of Resolution Plan. – (1)…………………
(2) The resolution professional shall examine each resolution plan received by him to confirm that each
resolution plan—
(a) provides for the payment of insolvency resolution process costs in a manner specified by the Board
in priority to the payment of other debts of the corporate debtor;
(b) provides for the payment of debts of operational creditors in such manner as may be specified by
the Board which shall not be less than—
(i) the amount to be paid to search creditors in the event of a liquidation of the corporate debtor
[2024] 2 S.C.R. 267

Greater Noida Industrial Development Authority v.
Prabhjit Singh Soni & Anr.

(iv) The NCLT failed to address and appreciate the grounds taken
in the correct perspective.
Findings of NCLAT
12. The appeal preferred by the appellant was dismissed by observing,
inter alia,
(i) the materials on record reflect that the RP had informed the
appellant vide e-mail dated 04.02.2020 about its status as an
Operational Creditor and to submit its claim in Form ‘B’, yet
the appellant chose not to file its claim;
(ii) in New Okhla Development Authority vs. Anand Sonbhadra16,
it was held that disbursement is an indispensable requirement
to constitute a financial debt within the meaning of Section
5(8)17 of the IBC and, that too, the disbursement must be from a

under section 53;
(ii) the amount that would have been paid to such creditors, if the amount to be distributed under
the resolution plan had been distributed in accordance with the order of priority in sub-section (1) of
section 53;
whichever is higher, and provides for the payment of debts of financial creditors, who do not vote in
favour of the resolution plan, in such manner as may be specified by the Board, which shall not be less
than the amount to be paid to such creditors in accordance with sub-section (1) of section 53 in the
event of a liquidation of the corporate debtor.
Explanation 1.-- For the removal of doubts, it is hereby clarified that a distribution in accordance with the
provisions of this clause shall be fair and equitable to such creditors.
Explanation 2.-- For the purposes of this clause it is hereby declared that on and from the date of com-
mencement of the Insolvency and Bankruptcy Code [Amendment] Act, 2019, the provisions of this
clause shall also apply to the corporate insolvency resolution process of a corporate debtor----
(i) where the resolution plan has not been approved or rejected by the adjudicating authority;
(ii) where an appeal has been preferred under section 61 or section 62 or such an appeal is not
time barred under any provision of law for the time being in force; or
(iii) where a legal proceeding has been initiated in any court against the decision of the adjudicating
authority in respect of a resolution plan;
(c) provides for the management of the affairs of the corporate debtor after approval of the resolution
plan;
(d) the implementation and supervision of the resolution plan;
(e) does not contravene any of the provisions of the law for the time being in force;
(f) conforms to such other requirements as may be specified by the Board.
16 [2022] 5 SCR 319 : (2023) 1 SCC 724
17 Section 5(8).—“financial debt” means a debt along with interest, if any, which is disbursed against the
consideration for the time value of money and includes –
(a) money borrowed against the payment of interest;
(b) any amount raised by acceptance under any acceptance credit facility or its dematerialised equiva-
lent;
(c) any amount raised pursuant to any note, purchase facility or the issue of bonds, notes, debentures,
loan stock or any similar instrument;
(d) the amount of any liability in respect of any lease or higher purchase contract which is deemed as a
financial or capital lease under the Indian Accounting Standards or such other accounting standards as
may be prescribed;
(e) receivables sold or discounted other than any receivables sold on non-recourse basis;
268 [2024] 2 S.C.R.

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creditor to a debtor, and as the lease executed by the appellant
was not a financial lease or capital lease, the appellant does
not qualify as a financial creditor;
(iii) the resolution plan was approved by the Adjudicating Authority
on 04.08.2020, and the successful resolution applicant (SRA)
seeking implementation of the plan informed the appellant
vide letter dated 24.09.2020 about the plan, yet I.A. No.344/
2021 was not filed before 06.10.2020 and I.A. No. 1380/2021,
seeking recall, was filed only on 15.03.2021, which shows that
the appellant had not been diligent in pursuing its right, if any,
therefore the challenge, post approval of the resolution plan,
is liable to be rejected; and
(iv) there appears no material irregularity in the approval of the
Resolution Plan, particularly, when the commercial wisdom of
the COC is not justiciable.
13. We have heard Sri Ravindra Kumar, learned senior counsel, for the
appellant; Dr. Abhishek Manu Singhvi, learned senior counsel, for
respondent no.2 (Resolution Applicant); and Sri V.M. Kannan for
respondent no.1 (Resolution Professional).
Submissions on behalf of the appellant
14. The learned counsel for the appellant, inter alia, submitted:
(a) There is no dispute that appellant had submitted its claim with
proof on 30.01.2020 as a financial creditor having security
interest over the assets of the CD. Even if the appellant was
not a financial creditor, the resolution plan ought to have noticed

(f) any amount raised under any other transaction, including any forward sale or purchase agreement,
having the commercial effect of a borrowing;
Explanation.-- For the purposes of this sub clause,--
(i) any amount raised from an allottee under a real estate project shall be deemed to be an amount
having the commercial effect of a borrowing; and
(ii) the expressions, “allottee” and “real estate project” shall have the meanings respectively assigned
to them in clauses (d) and (zn) of Section 2 of the Real Estate (Regulation and Development Act, 2016
(16 of 2016);
(g) any derivative transaction entered into in connection with protection against or benefit from fluctua-
tion in any rate or price and for calculating the value of any derivative transaction, only the market
value of such transaction shall be taken into account;
(h) any counter indemnity obligation in respect of a guarantee, indemnity bond, documentary letter of
credit or any other instrument issued by a bank or financial institution;
(i) the amount of any liability in respect of any of the guarantee or indemnity for any of the items
referred to in sub-clauses (a) to (h) of this clause;
[2024] 2 S.C.R. 269

Greater Noida Industrial Development Authority v.
Prabhjit Singh Soni & Anr.

its claim as a secured creditor whereas the order of approval
dated 4.8.2020 describes the appellant as one who did not
submit its claim.
(b) The meetings of the COC were not notified to the appellant to
enable its participation. In absence thereof, the resolution plan
stood vitiated.
(c) At the time of approving the resolution plan, the adjudicating
authority failed to consider whether the plan had made provisions
commensurate to appellant’s claim, and the statutory charge
which the appellant enjoyed over the assets of the CD. Not
only that, it overlooked the ownership and statutory rights
of the appellant over the land and thereby failed to consider
whether the plan was feasible and viable. In absence of such
consideration, the order of approval stood vitiated.
(d) The finding that there had been a delay on part of the appellant
in pursuing its remedies is misconceived, particularly when it was
established on record that I.A. No.344/ 2021 was filed promptly
on 6.10.2020 upon getting information on 24.09.2020 from the
monitoring agency regarding approval of the plan. Likewise,
I.A. No.1380/ 2021 was filed immediately on 15.03.2021 when
suspension of the period of limitation for any suit, appeal,
application or proceeding, imposed between 15.03.2020 and
14.03.2021, was lifted in terms of this Court’s order dated
8.03.2021 in RE: Cognizance For Extension of Limitation18.
Submissions on behalf of the respondents
15. Dr. Abhishek Manu Singhvi, leading the arguments on behalf of the
respondents, submitted that the issue as to whether dues payable to
an Industrial Area Development Authority, like the appellant, towards
lease/ allotment premium / rental, would be a financial debt or not is
no longer res integra, as it stands settled by a decision of this Court
in Anand Sonbhadra (supra), wherein it has been held that it is not
a financial debt. Therefore, the appellant had no voting right in the
COC. And since the appellant pressed its case only on the ground
that it is a financial creditor, its challenge to the order of approval
had no basis. More so, when the commercial wisdom of the COC

18 [2021] 2 SCR 640 : (2021) 5 SCC 452
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is not justiciable. Further, once the resolution plan, which makes a
provision for the appellant, is approved by the Adjudicating Authority,
it cannot be questioned through a recall application.
Analysis
16. Before we proceed to test the correctness of the impugned order
against the weight of rival submissions, it would be useful to have
a look at the statutory provisions of the IBC and the Regulations
framed thereunder with reference to the corporate insolvency
resolution process.
17. As per the provisions of the IBC, on admission of a petition, and
declaration of a moratorium under Section 13, a public announcement
is made inviting claims against the CD by a specified date. The
manner in which a public announcement is to be made and claims
are to be submitted, is described in the CIRP Regulations 2016.
18. Regulation 719 of CIRP Regulations, 2016 deals with submission of a
claim by a person who claims himself to be an operational creditor.
Such claim is to be submitted in Form B specified in the Schedule.
Whereas Regulation 820 deals with submission of a claim by a person
who claims himself to be a financial creditor. Such a claim is to be
submitted in Form C. Regulations 8-A, 9 and 9-A deal with other
classes of creditors with which we are not concerned here.

19 7. Claims by operational creditors.—(1) A person claiming to be an operational creditor, other than
workman or employee of the corporate debtor, shall submit claim with proof to the interim resolution
professional in person, by post or by electronic means in Form B of the Schedule:
Provided that such person may submit supplementary documents or clarifications in support of the
claim before the constitution of the committee.
(2) The existence of debt due to the operational creditor under this regulation may be proved on the
basis of—
(a) the records available with an information utility, if any; or
(b) other relevant documents, including—
(i) a contract for the supply of goods and services with corporate debtor;
(ii) an invoice demanding payment for the goods and services supplied to the corporate debtor;
(iii) an order of a court or tribunal that has adjudicated upon the non-payment of a debt, if any; or
(iv) financial accounts.
20 8. Claims by financial creditors.—(1) A person claiming to be a financial creditor, other than a
financial creditor belonging to a class of creditors, shall submit claim with proof to the interim resolution
professional in electronic form in Form C of the Schedule:
Provided that such person may submit supplementary documents or clarifications in support of the
claim before the constitution of the committee.
(2) The existence of debt due to the financial creditor may be proved on the basis of—
(a) the records available with an information utility, if any; or
(b) other relevant documents, including—
(i) a financial contract supported by financial statements as evidence of the debt;
(ii) a record evidencing that the amounts committed by the financial creditor to the corporate
debtor under a facility has been drawn by the corporate debtor;
(iii) financial statements showing that the debt has not been paid; or
(iv) an order of a court or tribunal that has adjudicated upon the non-payment of a debt, if any.
[2024] 2 S.C.R. 271

Greater Noida Industrial Development Authority v.
Prabhjit Singh Soni & Anr.

19. Regulation 1221 mandates submission of proof of the claim by the
date specified. Whereas, Regulation 1322 speaks of verification of
claims by the interim resolution professional (IRP) or the RP, as the
case may be. Regulation 1423 provides for determination of amount
of claim where the amount claimed is not precise.
20. The use of the words “a person claiming to be an operational
creditor” in the opening part of Regulation 7, and the words “a
person claiming to be a financial creditor” in Regulation 8, indicate
that the category in which the claim is submitted is based on the
own understanding of the claimant. Thus, there could be a situation
where the claimant, in good faith, may place itself in a category to
which it does not belong. However, what is important is, the claim
so submitted must be with proof. As to what could form proof of the
debt/ claim is delineated in sub-regulation (2) of Regulations 7 and
8 of the CIRP Regulations, 2016.

21 12. Submission of proof of claims.—(1) Subject to sub-regulation (2), a creditor shall submit claim
with proof on or before the last date mentioned in the public announcement.
(2) A creditor, who fails to submit claim with proof within the time stipulated in the public announcement,
may submit the claim with proof to the interim resolution professional or the resolution professional, as
the case may be, on or before the ninetieth day of the insolvency commencement date.
(3) Where the creditor in sub-regulation (2) is a financial creditor under Regulation 8, it shall be in-
cluded in the committee from the date of admission of such claim:
Provided that such inclusion shall not affect the validity of any decision taken by the committee prior to
such inclusion.
22 13. Verification of claims.—(1) The interim resolution professional or the resolution professional, as
the case may be, shall verify every claim, as on the insolvency commencement date, within seven
days from the last date of the receipt of the claims, and thereupon maintain a list of creditors containing
names of creditors along with the amount claimed by them, the amount of their claims admitted and the
security interest, if any, in respect of such claims, and update it.
(2) The list of creditors shall be—
(a) available for inspection by the persons who submitted proofs of claim;
(b) available for inspection by members, partners, directors and guarantors of the corporate debtor
or their authorised representatives;
(c) displayed on the website, if any, of the corporate debtor;
(ca) filed on the electronic platform of the Board for dissemination on its website:
Provided that this clause shall apply to every corporate insolvency resolution process ongoing and
commencing on or after the date of commencement of the Insolvency and Bankruptcy Board of India
(Insolvency Resolution Process for Corporate Persons) (Fifth Amendment) Regulations, 2020;
(d) filed with the adjudicating authority; and
(e) presented at the first meeting of the committee.
23 14. Determination of amount of claim.—(1) Where the amount claimed by a creditor is not precise
due to any contingency or other reason, the interim resolution professional or the resolution profes-
sional, as the case may be, shall make the best estimate of the amount of the claim based on the
information available with him.
(2) The interim resolution professional or the resolution professional, as the case may be, shall revise
the amounts of claims admitted, including the estimates of claims made under sub-regulation (1), as
soon as may be practicable, when he comes across additional information warranting such revision.”
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21. Once a claim is submitted with proof under any of the Regulations
(i.e., Regulations 7, 8, 8-A, 9 and 9-A), the IRP or the RP, as the
case may be, as per Regulation 13, has to verify the claim, as on
the insolvency commencement date, and thereupon maintain a list
of creditors containing names of creditors along with the amount
claimed by them, the amount of their claims admitted and the security
interest, if any, in respect of such claims, and update it in terms of
Regulation 12 A24.
22. As it could be noticed from the CIRP Regulations, 2016, on submission
of a claim with proof, the IRP or the RP, as the case may be, has to
verify the claim and prepare a list of creditors containing names of
creditors along with the amount claimed by them and security interest,
if any, the logical conclusion derivable from the provisions analysed
above would be that the Form in which a claim is to be submitted
under the CIRP Regulations 2016 is directory and not mandatory.
What is important is, the claim must be supported by proof.
23. On collation of claims received against the CD, the IRP has to
constitute a COC. As per Section 21 (2) of the IBC, subject to other
provisions of Section 21, the COC must comprise all financial creditors
of a CD. Under Section 22 of the IBC, the COC appoints an RP in
its first meeting. It may, however, resolve to appoint the IRP as the
RP, subject to confirmation by the Board.
24. The RP has many important duties. Some of the duties which an
RP has to perform, under Section 25 of the IBC, are to: (a) take
immediate custody and control of all the assets of the CD, including
the business records of the CD; (b) maintain an updated list of
claims; (c) convene and attend all meetings of the COC; (d) prepare
information memorandum in accordance with Section 29 read with
Regulation 36 of the CIRP Regulations 201625; (e) invite prospective

24 !2 A. Updation of claim. — A creditor shall update its claim as and when the claim is satisfied, partly
or fully, from any source in any manner, after the insolvency commencement date.
25 Regulation 36. Information memorandum. – (1) Subject to sub regulation [4], the resolution profes-
sional shall submit the information memorandum in electronic form to each member of the committee
within 2 weeks of his appointment, but not later than 54th day from the insolvency commencement
date, whichever is earlier.
(2) the information memorandum shall contain the following details of the corporate debtor--
[a] assets and liabilities with such description, as on the insolvency commencement date, as are
generally necessary for ascertaining their values.
Explanation.- Description includes the details such as date of acquisition cost of acquisition, re-
maining useful life identification number, depreciation charged, book value, and any other relevant
details.
[2024] 2 S.C.R. 273

Greater Noida Industrial Development Authority v.
Prabhjit Singh Soni & Anr.

resolution applicants to submit a resolution plan or plans; and (f)
present all resolution plans at the meetings of the COC.
25. The meetings of the COC are to be conducted by the RP. Sub
section (3) of Section 2426, inter alia, provides that the RP shall
give notice of each meeting of the COC to the operational creditors
or their representative(s) if the amount of their aggregate dues is
not less than ten percent of the debt. Regulation 19 of the CIRP
Regulations, 2016 further mandates the RP to ensure that notice of
the meeting is given to every participant. “Participant” is defined in
Regulation 2 (l) of the CIRP Regulations 2016 as a person who is
entitled to attend a meeting of the COC under Section 24 of the IBC
or any other person authorised by the COC to attend the meeting.
26. Based on the information memorandum, when a resolution plan is
submitted by a resolution applicant, eligible under Section 29-A of the
IBC, the RP is under an obligation to examine whether the resolution

(b) the latest annual financial statements;
(c) financial statements of the corporate debtor for the last 2 financial years and provisional finan-
cial statements for the current financial year made up to a date not earlier than 14 days from the
date of the application;
(d) a list of creditors containing the names of creditors, the amounts claimed by them, the amount
of their claims admitted and the security interest, if any, in respect of such claims;
(e) particulars of a debt due from or to the corporate debtor with respect to related parties;
(f) details of guarantees that have been given in relation to the debts of the corporate debtor by
other persons, specifying which of the guarantors is a related party;
(g) the names and addresses of the members or partners holding at least 1% stake in the corpo-
rate debtor along with the size of stake;
(h) details of all material litigation and an ongoing investigation or proceeding initiated by Govern-
ment and statutory authorities;
(i) the number of workers and employees and liabilities of the corporate debtor towards them;
(j) *******omitted
(k)*******omitted
(l) other information, which the resolution professional deems relevant to the committee.
(3) A member of the committee may request the resolution professional for further information of the
nature described in this regulation and the resolution professional shall provide such information to all
members within reasonable time if such information has a bearing on the resolution plan.
(4) The resolution professional shall share the information memorandum after receiving an undertaking
from a member of the committee to the effect that such member or resolution applicant shall maintain
confidentiality of the information and shall not use such information to cause an undue gain or undue
loss to itself or any other person and comply with the requirements under subsection [2] of section 29.
26 “Section 24. Meeting of committee of creditors.--- (1)………
(2)…………..
(3) The resolution professional shall give notice of each meeting of the committee of creditors to—
(a) members of committee of creditors, including the authorized representatives referred to in
sub-sections (6) and (6A) of section 2 and sub-section (5);
(b) members of the suspended Board of Directors or the partners of the corporate persons, as
the case may be;
(c). operational creditors or their representatives if the amount of their aggregate dues is not
less than ten percent of the debt
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plan(s) received by him conform(s) to the conditions referred to in
sub-section (2) of Section 30 of the IBC as elaborated in Regulations
3727 and 3827A of the CIRP Regulations 2016.
27. The resolution plan that conforms to the conditions referred to in
sub-section (2) of Section 30 is to be presented by the RP to the
COC for its approval. Thereafter, under sub-section (4) of Section
3028, the COC may approve the plan after considering its feasibility

27 Regulation 37. Resolution Plan.-- A resolution plan shall provide for the measures as may be neces-
sary, for insolvency resolution of the corporate debtor for maximization of value of its assets including
but not limited to the following:-
[a] transfer of all or part of the assets of the corporate debtor to one or more persons;
(b) sale of all or part of the assets whether subject to any security interest or not;
[ba] restructuring of the corporate debtor, by way of merger, amalgamation and demerger;
[c] the substantial acquisition of shares of the corporate debtor or the merger or consolidation of the
corporate debtor with one or more persons;
[ca] cancellation or delisting of any shares of the corporate debtor if applicable;
[d] satisfaction or modification of any security interest;
[e] curing or waving of any breach of the terms of any debt due from the corporate debtor;
[f] reduction in the amount payable to the creditors;
[g] extension of a maturity date or change in interest rate or other terms of a debt due from the
corporate debtor;
[h] amendment of the constitutional documents of the corporate debtor;
[i] issuance of securities of the corporate debtor for cash, property, securities, or in exchange for
claims or interest, or other appropriate purpose;
[j] change in portfolio of goods or services produced or rendered by the corporate debtors;
[k] change in technology used by the corporate debtor; and
[l] obtaining necessary approvals from the central and state governments and other authorities.
27A Regulation 38. Mandatory contents of the resolution plan.---(1) The amount payable under a
resolution plan-----
(a) to the operational creditors shall be paid in priority over financial creditors; and
(b) to the financial creditors, who have a right to vote under sub- section (2) of Section 21 and did
not vote in favour of the resolution plan, shall be paid in priority over financial creditors who voted
in favour of the plan.
(1A) A resolution plan shall include a statement as to how it has dealt with the interests of all stakehold-
ers including financial creditors and operational creditors, of the corporate debtor.
(1B) A resolution plan shall include a statement giving details if the resolution applicant or any of its
related parties has failed to implement or contributed to the failure of implementation of any other
resolution plan approved by the adjudicating authority at any time in the past.
(2) A resolution plan shall provide:
[a] the term of the plan and its implementation schedule;
[b] the management and control of the business of the corporate debtor during its term; and
[c) adequate means for supervising its implementation.
(3) A resolution plan shall demonstrate that----
[a] it addresses the cause of the fault;
[b] it is feasible and viable;
[c] it has provisions for its effective implementation;
(d) it has provisions for approvals required and the timeline for the same; and
[e] the resolution applicant has the capability to implement the resolution plan.
28 Section 30 (4). The committee of creditors may approve a resolution plan by a vote of not less than
sixty six percent of voting share of financial creditors, after considering its feasibility and viability, the
manner of distribution proposed, which may take into account the order of priority amongst creditors
as laid down in sub-section (1) of section 53, including the priority and value of the security interest of
secured creditor and such other requirements as may be specified by the Board:
………………”
[2024] 2 S.C.R. 275

Greater Noida Industrial Development Authority v.
Prabhjit Singh Soni & Anr.

and viability, the manner of distribution proposed, which may take
into account the order of priority amongst creditors as laid down
in sub-section (1) of Section 53, including the priority and value of
security interest of a secured creditor and such other requirements
as may be specified by the Board.
28. Once the plan is approved by the COC, the RP has to submit it
for approval of the Adjudicating Authority. As per sub-section (1) of
Section 3129 of the IBC, if the Adjudicating Authority is satisfied that
the resolution plan as approved by the COC under sub-section (4) of
Section 30 meets the requirements of sub-section (2) of Section 30, it
has to approve the resolution plan. On its approval, the plan becomes
binding on the CD and its employees, members, creditors, including
the Central Government, any State Government or any local authority
to whom a debt in respect of the payment of dues arising under any
law for the time being in force, such as authorities to whom statutory
dues are owed, guarantors and other stakeholders involved in the
resolution plan. But where the Adjudicating Authority is satisfied that
the resolution plan does not conform to the requirements referred
to in sub-section (1), it may, in exercise of power under sub-section
(2) of Section 31, by an order, reject the resolution plan.
29. Explaining the scheme of the CIRP under the IBC, in Ghanashyam
Mishra & Sons (P) Ltd. vs. Edelweiss Asset Reconstruction
Co. Ltd.30, a three-Judge Bench of this Court observed that one
of the principal objects of the IBC is to provide for revival of the
CD and to make it a going concern. The RP on commencement
of CIRP is required to issue a publication inviting claims from all
the stakeholders; thereafter, on basis of claims received, the RP
is required to collate the information and submit necessary details
in the information memorandum; the resolution applicant(s) submit
their plan(s) on the basis of the details provided in the information
memorandum; the resolution plan(s) undergo deep scrutiny by RP

29 “Section 31. Approval of resolution plan.- (1) If the Adjudicating Authority is satisfied that the
resolution plan as approved by the committee of creditors under sub-section (4) of section 30 meets
the requirements as referred to in sub-section (2) of section 30, it shall by order approve the resolution
plan which shall be binding on the corporate debtor and its employees, members, creditors, including
the Central Government, any State Government or any local authority to whom a debt in respect of the
payment of dues under any law for the time being in force, such as authorities to whom statutory dues
are owed, guarantors and other stakeholders involved in the resolution plan:
………….”.
30 [2021] 13 SCR 737 : (2021) 9 SCC 657 (paragraph 93)
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as well as COC; in the negotiations that may be held between COC
and the resolution applicant, various modifications may be made so
as to ensure that while paying part of the dues of financial creditors
as well as operational creditors and other stakeholders, the CD is
revived and is made an on-going concern; after COC approves the
plan, the adjudicating authority is required to arrive at a subjective
satisfaction that the plan conforms to the requirements as are
provided in sub-section (2) of Section 30 of IBC; and only thereafter,
the adjudicating authority can grant its approval to the plan.
30. What is clear from the provisions of the IBC and the Regulations
noticed above is, that the RP is under a statutory obligation to
collate the data obtained from (a) the claim(s) made before it and
(b) information gathered from the records including those maintained
by the CD. The data so collated forms part of the information
memorandum. Based on that information, the resolution applicant(s)
submit(s) plan. In consequence, even if a claim submitted by a creditor
against the CD is in a Form not as specified in the CIRP Regulations,
2016, the same has to be given due consideration by the IRP or the
RP, as the case may be, if it is otherwise verifiable, either from the
proof submitted by the creditor or from the records maintained by
the CD. A fortiori, if a claim is submitted by an operational creditor
claiming itself as a financial creditor, the claim would have to be
accorded due consideration in the category to which it belongs
provided it is verifiable.
31. On submission of the plan by a resolution applicant, the RP examines
it to confirm whether it meets the requirements of sub-section
(2) of Section 30 and, if it conforms to the conditions referred to
therein, present the plan to the COC for its approval. After the
plan is presented to the COC for its approval, the COC, under
sub-section (4) of Section 30, has to consider its feasibility and
viability, the manner of distribution proposed, including the priority
and value of the security interest of a secured creditor and such
other requirements as may be specified by the Board. Once that
exercise is over, the plan is submitted for approval of the Adjudicating
Authority, which must, under sub-section (1) of Section 31, satisfy
itself as to whether the plan approved by COC under sub-section (4)
of Section 30 meets the requirements as referred to in sub-section
(2) of Section 30 of IBC.
[2024] 2 S.C.R. 277

Greater Noida Industrial Development Authority v.
Prabhjit Singh Soni & Anr.

32. In Jaypee Kensington Boulevard Apartments Welfare Association
vs. NBCC (India) Ltd.,31 a three-Judge Bench of this Court had
occasion to examine the scope of judicial review exercisable
by: (a) the Adjudicating Authority, under Section 31 (1), over a
resolution plan approved by the COC; and (b) the Appellate Authority
exercising its power under Section 32 read with Section 61 (3) of
the IBC. After examining the relevant provisions of the IBC and the
Regulations framed thereunder, and upon a survey of various judicial
pronouncements on the subject, the scope of judicial review was
summarised as follows:
“108. To put in a nutshell, the adjudicating authority
has limited jurisdiction in the matter of approval of a
resolution plan, which is well-defined and circumscribed
by Sections 30(2) and 31 of the Code read with the
parameters delineated by this Court in the decisions
above-referred. The jurisdiction of the appellate authority
is also circumscribed by the limited grounds of appeal
provided in Section 61 of the Code. In the adjudicatory
process concerning a resolution plan under IBC, there is no
scope for interference with the commercial aspects of the
decision of the CoC; and there is no scope for substituting
any commercial term of the resolution plan approved by
the CoC. Within its limited jurisdiction, if the adjudicating
authority or the appellate authority, as the case may be,
would find any shortcoming in the resolution plan vis-à-vis
the specified parameters, it would only send the resolution
plan back to the Committee of Creditors, for re-submission
after satisfying the parameters delineated by the Code and
exposited by this Court.
(Emphasis supplied)
33. In light of the analysis of the provisions of the IBC and the Regulations
framed thereunder, in our view, though commercial wisdom of the
COC in approving a resolution plan may not be justiciable in exercise
of the power of judicial review, the Adjudicating Authority can always
take notice of any shortcoming in the resolution plan in terms of the
parameters specified in sub-section (2) of Section 30 of the IBC

31 [2021] 12 SCR 603 : (2022) 1 SCC 401
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coupled with Regulations 37 and 38 of the CIRP Regulations 2016.
If any such shortcoming appears in the resolution plan, it may send
the resolution plan back to the COC for re-submission after satisfying
the parameters so laid down. Likewise, the appellate authority can
also interfere upon noticing any shortcoming in the resolution plan
while exercising its powers under Section 3232 read with Section 61
(3)33 of the IBC.
34. In the instant case, a perusal of the approval order dated 04.08.2020
would reveal that the resolution plan put forth by the resolution
applicant refers to the appellant as a creditor who had not submitted
its claim. Further, the dues shown payable to the appellant are Rs.
13,47,40,819/- when, according to the appellant, its claim was for
Rs. 43,40,31,951/- Not only that, the amount proposed to be paid is
just Rs.1,34,74,082/-, that too, payable by conversion of dues into
square feet of area to be completed and payment to be made, on
square feet basis, at the time of registration of each of the units.
35. However, what is important is that neither NCLT nor NCLAT rejected
the assertion of the appellant that on 30.01.2020, in response to the
public announcement, the appellant had submitted with proof a claim
of Rs.43,40,31,951/- before the RP, being the amount payable to it by
the CD towards unpaid premium including interest payable thereon
for the lease/allotment of land owned by the appellant.
36. According to the appellant, the resolution plan fails to take into account
the following: (a) the appellant had submitted its claim with proof
for Rs. 43,40,31,951/-; (b) the appellant had a statutory charge over
the assets of the CD; (c) the entire land over which the project has
been conceived is owned by the appellant; (d) a notice to cancel the

32 Section 32. Appeal. - Any appeal from an order approving the resolution plan shall be in the manner
and on the grounds laid down in sub-section (3) of Section 61.
33 Section 61. Appeals and Appellate Authority. – (1)…………
(2)………….
(3) An appeal against an order approving resolution plan under Section 31 may be filed on the follow-
ing grounds, namely:-
[i] the approved resolution plan is in contravention of the provisions of any law for the time being in
force;
(ii) there has been material irregularity in exercise of the powers by the resolution professional during
the corporate insolvency resolution period;
(iii) the debts owed to operational creditors of the corporate debtor have not been provided for in the
resolution plan in the manner specified by the Board;
(iv) the insolvency resolution process costs have not been provided for repayment in priority to all other
debts; or
(v) the resolution plan does not comply with any other criteria specified by the Board.
[2024] 2 S.C.R. 279

Greater Noida Industrial Development Authority v.
Prabhjit Singh Soni & Anr.

lease for non-payment of dues had already been served on the CD;
and (e) without approval of the appellant, the plan was not feasible.
Further, according to the appellant, the plan did not conform to the
conditions referred to in sub-section (2) of Section 30 of the IBC read
with Regulations 37 and 38 of the CIRP Regulations 2016; and that
the entire process of preparing the resolution plan and approving the
same had been ex parte, thereby seriously prejudicing the interest
of the appellant. It is the case of the appellant that neither NCLT
nor NCLAT accorded due consideration to the above aspects while
rejecting the application/ appeal of the appellant.
37. Per contra, on behalf of the respondents, it was urged that,- (a)
the appellant had pressed its case only on the ground that it was a
financial creditor, once this plea is found unsustainable, no relief can
be granted to the appellant, as commercial wisdom of the COC is
not justiciable; (b) NCLT has no power to recall its order of approval,
the remedy for the appellant was to file an appeal within the time
provided by the statute; and (c) there has been inordinate delay on
the part of the appellant in questioning the order of approval.
38. At this stage, we may put on record that the appellant had set up
its claim as a financial creditor. However, the appellant was found
to be an operational creditor. Though a challenge to this finding has
been laid but, during the course of arguments, the learned counsel
for the appellant failed to demonstrate as to how could the appellant
be considered a financial creditor. In view thereof, taking notice of
the decision in Anand Sonbhadra (supra), we do not propose to
deal with the submission that the appellant was a financial creditor.
39. Upon consideration of the rival submissions, following issues arise
for our consideration in this appeal:
(i) Whether in exercise of powers under sub-section (5) of Section
60, the Adjudicating Authority (i.e., NCLT) can recall an order of
approval passed under sub-section (1) of Section 31 of the IBC?.
(ii) Whether the application for recall of the order was barred by
time?
(iii) Whether the resolution plan put forth by the resolution applicant
did not meet the requirements of sub-section (2) of Section
30 of the IBC read with Regulations 37 and 38 of the CIRP
Regulations, 2016?
(iv) As to what relief, if any, the appellant is entitled to?
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Recall Application is maintainable.
40. Section 60 of the IBC specifies that the Adjudicating Authority in
relation to insolvency resolution and liquidation for corporate persons
including corporate debtors and personal guarantors thereof shall
be the NCLT having territorial jurisdiction over the place where the
registered office of the corporate person is located. Sub-section (5)
of Section 60 provides that notwithstanding anything to the contrary
contained in any other law for the time being in force, the NCLT shall
have jurisdiction to entertain or dispose of: (a) any application or
proceeding by or against the corporate debtor or corporate person;
(b) any claim made by or against the corporate debtor or corporate
person, including claims by or against any of its subsidiaries situated
in India; and (c) any question of priorities or any question of law
or facts, arising out of or in relation to the insolvency resolution or
liquidation proceedings of the corporate debtor or corporate person
under the IBC.
41. The NCLT has been constituted by the Central Government in
exercise of power under Section 408 of the Companies Act, 2013.
Section 408 of the Companies Act is in following terms:
“The Central Government shall, by notification, constitute
with effect from such date as may be specified therein, a
tribunal to be known as the National Company Law Tribunal
consisting of a President and such number of judicial and
technical members as the Central Government may deem
necessary, to be appointed by it by notification to exercise
and discharge such powers and functions as are, or may
be, conferred on it by or under this Act or any other law
for the time being in force.”
42. Rule 11 of the National Company Law Tribunal Rules, 2016, framed
under Section 469 of the Companies Act 2013, which is in pari materia
with Section 15134 of Code of Civil Procedure, 190835, preserve the
inherent powers of the Tribunal in the following terms:

34 Section 151.- Saving of inherent powers of Court. - Nothing in this Code shall be deemed to limit
or otherwise affect the inherent power of the Court to make such orders as may be necessary for the
ends of justice or to prevent abuse of the process of the Court
35 CPC
[2024] 2 S.C.R. 281

Greater Noida Industrial Development Authority v.
Prabhjit Singh Soni & Anr.

“Nothing in these rules shall be deemed to limit or otherwise
affect the inherent powers of the Tribunal to make such
orders as may be necessary for meeting the ends of justice
or to prevent abuse of the process of the Tribunal.”
43. In Manohar Lal Chopra vs. Rai Bahadur Rao Raja Seth Hiralal36
a four-Judge Bench of this Court in the context of powers vested in
the Court, while interpreting Section 151 CPC, observed:
“23… The Section itself says that nothing in the Code
shall be deemed to limit or otherwise affect the inherent
power of the Court to make orders necessary for the ends
of justice. In the face of such a clear statement, it is not
possible to hold that the provisions of the Code control the
inherent power by limiting it or otherwise affecting it. The
inherent power has not been conferred upon the court; it
is a power inherent in the Court by virtue of its duty to do
justice between the parties before it.”
(Emphasis supplied)
44. In Grindlays Bank Ltd. vs. Central Govt. Industrial Tribunal37 a
question arose whether Central Government Industrial Tribunal has
power to recall/ set aside an ex parte award when the party aggrieved
had been prevented from appearing by a sufficient cause. Holding
that such power inheres in a Tribunal, this Court observed:
“6. We are of the opinion that the Tribunal had the power
to pass the impugned order if it thought fit in the interest
of justice. It is true that there is no express provision in
the Act or the rules framed thereunder giving the Tribunal
jurisdiction to do so. But it is a well-known rule of statutory
construction that a Tribunal or body should be considered
to be endowed with such ancillary or incidental powers as
are necessary to discharge its functions effectively for the
purpose of doing justice between the parties. In a case of
this nature, we are of the view that the Tribunal should be
considered as invested with such incidental or ancillary

36 [1962] Supp. (1) S.C.R. 450 : AIR 1962 SC 527
37 [1981] 2 SCR 341 : 1980 Supp SCC 420
282 [2024] 2 S.C.R.

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powers unless there is any indication in the statute to the
contrary. We do not find any such statutory prohibition.
On the other hand, there are indications to the contrary.”
(Emphasis Supplied)
In addition to above, recognising the difference between a procedural
review and a review on merits, it was observed:
13…………The expression “review” is used in the two
distinct senses, namely (1) a procedural review which is
either inherent or implied in a court or Tribunal to set aside a
palpably erroneous order passed under a misapprehension
by it, and (2) a review on merits when the error sought to
be corrected is one of law and is apparent on the face of
the record. …………. Obviously when a review is sought
due to a procedural defect, the inadvertent error committed
by the Tribunal must be corrected ex debito justitiae to
prevent the abuse of its process, and such power inheres
in every court or Tribunal.”
45. In State of Punjab vs. Davinder Pal Singh Bhullar 38, while
considering the bar imposed on a Court by Section 362 of the
Criminal Procedure Code, 1973 on review of a judgment or final
order disposing of a case, it was observed:
“46. If a judgment has been pronounced without jurisdiction
or in violation of principles of natural justice or where the
order has been pronounced without giving an opportunity
of being heard to a party affected by it or where an order
was obtained by abuse of the process of court which would
really amount to its being without jurisdiction, inherent
powers can be exercised to recall such order for the reason
that in such an eventuality the order becomes a nullity and
the provisions of Section 362 CrPC would not operate. In
such an eventuality, the judgment is manifestly contrary to
the audi alteram partem rule of natural justice. The power
of recall is different from the power of altering/reviewing
the judgment. However, the party seeking recall/alteration
has to establish that it was not at fault.”

38 [2011] 15 SCR 540 : (2011) 14 SCC 770
[2024] 2 S.C.R. 283

Greater Noida Industrial Development Authority v.
Prabhjit Singh Soni & Anr.

46. The above passage was cited and approved by a three-Judge Bench
of this Court in New India Assurance Co. Ltd. vs. Krishna Kumar
Pandey39.
47. In Budhia Swain vs. Gopinath Deb40, after considering a number
of decisions, a two-Judge Bench of this Court observed:
“8. In our opinion a tribunal or a court may recall an order
earlier made by it if
(i) the proceedings culminating into an order suffer
from the inherent lack of jurisdiction and such lack
of jurisdiction is patent,
(ii) there exists fraud or collusion in obtaining the
judgment,
(iii) there has been a mistake of the court prejudicing a
party, or
(iv) a judgment was rendered in ignorance of the fact that
a necessary party had not been served at all or had
died and the estate was not represented.
The power to recall a judgment will not be exercised when
the ground for reopening the proceedings or vacating the
judgment was available to be pleaded in the original action
but was not done or where a proper remedy in some
other proceeding such as by way of appeal or revision
was available but was not availed. The right to seek
vacation of a judgment may be lost by waiver, estoppel
or acquiescence.”
48. The law which emerges from the decisions above is that a Tribunal
or a Court is invested with such ancillary or incidental powers as may
be necessary to discharge its functions effectively for the purpose
of doing justice between the parties and, in absence of a statutory
prohibition, in an appropriate case, it can recall its order in exercise
of such ancillary or incidental powers.

39 (2021) 14 SCC 683
40 [1999] 2 SCR 1189 : (1999) 4 SCC 396
284 [2024] 2 S.C.R.

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49. In a recent decision (i.e., Union Bank of India vs. Dinakar T.
Vekatasubramanian & Ors.), a five-member Full Bench of NCLAT
held that though the power to review is not conferred upon the
Tribunal but power to recall its judgment is inherent in the Tribunal
and is preserved by Rule 11 of the NCLT Rules, 2016. It was held
that power of recall of a judgment can be exercised when any
procedural error is committed in delivering the earlier judgment; for
example, necessary party has not been served or necessary party
was not before the Tribunal when judgment was delivered adverse
to a party. It was observed that there may be other grounds for
recall of a judgment one of them being where fraud is played on the
Court in obtaining a judgment. This decision of NCLAT was upheld
by a two-Judge Bench of this Court vide order dated 31.07.2023 in
Civil Appeal No.4620 of 2023 (Union Bank of India vs. Financial
Creditors of M/s Amtek Auto Ltd. & Ors.).
50. In light of the discussion above, what emerges is, a Court or a Tribunal,
in absence of any provision to the contrary, has inherent power to
recall an order to secure the ends of justice and/or to prevent abuse
of the process of the Court. Neither the IBC nor the Regulations
framed thereunder, in any way, prohibit, exercise of such inherent
power. Rather, Section 60(5)(c) of the IBC, which opens with a non-
obstante clause, empowers the NCLT (the Adjudicating Authority) to
entertain or dispose of any question of priorities or any question of
law or facts, arising out of or in relation to the insolvency resolution
or liquidation proceedings of the corporate debtor or corporate person
under the IBC. Further, Rule 11 of the NCLT Rules, 2016 preserves
the inherent power of the Tribunal. Therefore, even in absence of
a specific provision empowering the Tribunal to recall its order,
the Tribunal has power to recall its order. However, such power is
to be exercised sparingly, and not as a tool to re-hear the matter.
Ordinarily, an application for recall of an order is maintainable on
limited grounds, inter alia, where (a) the order is without jurisdiction;
(b) the party aggrieved with the order is not served with notice of
the proceedings in which the order under recall has been passed;
and (c) the order has been obtained by misrepresentation of facts
or by playing fraud upon the Court /Tribunal resulting in gross failure
of justice.
[2024] 2 S.C.R. 285

Greater Noida Industrial Development Authority v.
Prabhjit Singh Soni & Anr.

51. In the case on hand, the recall application was filed by claiming that,-
(a) the appellant was not informed of the meetings of the COC; (b)
the proceedings up to the stage of approval of the resolution plan by
the Adjudicating Authority were ex parte; (c) the RP misrepresented
that the appellant had submitted no claim when, otherwise, a claim
was submitted of an amount higher than what was shown outstanding
towards the appellant; and (d) there was gross mistake on part of
the Adjudicating Authority in approving the plan which did not fulfil
the conditions laid down in sub-section (2) of Section 30 of the IBC.
52. In our view, the grounds taken qualify as valid grounds on which a
recall of the order of approval dated 04.08.2020 could be sought. We
thus hold that the recall application was maintainable notwithstanding
that an appeal lay before the NCLAT against the order of approval
passed by the Adjudicating Authority.
The Recall Application was not barred by time.
53. As regards the plea that the recall application was barred by time,
suffice it to say that I.A. No.344/ 2021 was filed on 6.10.2020 upon
getting information on 24.09.2020 from the monitoring agency
regarding approval of the plan. Likewise, I.A. No.1380/ 2021 was
filed on 15.03.2021 immediately when suspension of the period of
limitation for any suit, appeal, application or proceeding, between
15.03.2020 and 14.03.2021, was lifted in terms of this Court’s order
dated 8.03.2021 in RE: Cognizance For Extension of Limitation
(supra). We, therefore, find no substance in the plea that the
applications were barred by limitation.
The Resolution Plan did not meet the requirements of Section
30 (2) of the IBC read with Regulations 37 and 38 of the CIRP
Regulations, 2016
54. In our view the resolution plan did not meet the requirements of
Section 30(2) of the IBC read with Regulations 37 and 38 of the
CIRP Regulations, 2016 for the following reasons:
a. The resolution plan disclosed that the appellant did not submit
its claim, when the unrebutted case of the appellant had been
that it had submitted its claim with proof on 30.01.2020 for a
sum of Rs.43,40,31,951/- No doubt, the record indicates that
the appellant was advised to submit its claim in Form B (meant
286 [2024] 2 S.C.R.

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for operational creditor) in place of Form C (meant of financial
creditor). But, assuming the appellant did not heed the advice,
once the claim was submitted with proof, it could not have
been overlooked merely because it was in a different Form.
As already discussed above, in our view the Form in which a
claim is to be submitted is directory. What is necessary is that
the claim must have support from proof. Here, the resolution
plan fails not only in acknowledging the claim made but also in
mentioning the correct figure of the amount due and payable.
According to the resolution plan, the amount outstanding was Rs.
13,47,40,819/- whereas, according to the appellant, the amount
due and for which claim was made was Rs. 43,40,31,951/- This
omission or error, as the case may be, in our view, materially
affected the resolution plan as it was a vital information on
which there ought to have been application of mind. Withholding
the information adversely affected the interest of the appellant
because, firstly, it affected its right of being served notice of the
meeting of the COC, available under Section 24 (3) (c) of the
IBC to an operational creditor with aggregate dues of not less
than ten percent of the debt and, secondly, in the proposed
plan, outlay for the appellant got reduced, being a percentage
of the dues payable. In our view, for the reasons above, the
resolution plan stood vitiated. However, neither NCLT nor NCLAT
addressed itself on the aforesaid aspects which render their
orders vulnerable and amenable to judicial review.
b. The resolution plan did not specifically place the appellant in
the category of a secured creditor even though, by virtue of
Section 13-A of the 1976 Act, in respect of the amount payable
to it, a charge was created on the assets of the CD. As per
Regulation 37 of the CIRP Regulations 2016, a resolution
plan must provide for the measures, as may be necessary, for
insolvency resolution of the CD for maximization of value of its
assets, including, but not limited to, satisfaction or modification of
any security interest. Further, as per Explanation 1, distribution
under clause (b) of sub-section (2) of Section 30 must be fair
and equitable to each class of creditors. Non-placement of the
appellant in the class of secured creditors did affect its interest.
However, neither NCLT nor NCLAT noticed this anomaly in the
plan, which vitiates their order.
[2024] 2 S.C.R. 287

Greater Noida Industrial Development Authority v.
Prabhjit Singh Soni & Anr.

c. Under Regulation 38 (3) of the CIRP Regulations, 2016, a resolution
plan must, inter alia, demonstrate that (a) it is feasible and viable;
and (b) it has provisions for approvals required and the time-line
for the same. In the instant case, the plan conceived utilisation of
land owned by the appellant. Ordinarily, feasibility and viability of
a plan are economic decisions best left to the commercial wisdom
of the COC. However, where the plan envisages use of land not
owned by the CD but by a third party, such as the appellant,
which is a statutory body, bound by its own rules and regulations
having statutory flavour, there has to be a closer examination
of the plan’s feasibility. Here, on the part of the CD there were
defaults in payment of instalments which, allegedly, resulted in
raising of demand and issuance of pre-cancellation notice. In these
circumstances, whether the resolution plan envisages necessary
approvals of the statutory authority is an important aspect on which
feasibility of the plan depends. Unfortunately, the order of approval
does not envisage such approvals. But neither NCLT nor NCLAT
dealt with those aspects.
Relief
55. As we have found that neither NCLT nor NCLAT while deciding the
application /appeal of the appellant took note of the fact that,- (a)
the appellant had not been served notice of the meeting of the
COC; (b) the entire proceedings up to the stage of approval of the
resolution plan were ex parte to the appellant; (c) the appellant had
submitted its claim, and was a secured creditor by operation of law,
yet the resolution plan projected the appellant as one who did not
submit its claim; and (d) the resolution plan did not meet all the
parameters laid down in sub-section (2) of Section 30 of the IBC
read with Regulations 37 and 38 of the CIRP Regulations, 2016,
we are of the considered view that the appeals of the appellant are
entitled to be allowed and are accordingly allowed. The impugned
order dated 24.11.2022 is set aside. The order dated 04.08.2020
passed by the NCLT approving the resolution plan is set aside. The
resolution plan shall be sent back to the COC for re-submission after
satisfying the parameters set out by the Code as exposited above.
There shall be no order as to costs.

Headnotes prepared by: Divya Pandey Result of the case:
Appeals allowed.