Case Note & Summary
The appeal was filed by Nivaya Resources Private Limited against an order dated 01.09.2026, which involved the forfeiture of a bank guarantee and the approval of a resolution plan under the Corporate Insolvency Resolution Process (CIRP) for M/s GPT Steel Industries Ltd. The Appellant claimed to be the Successful Resolution Applicant (SRA) and argued that the Information Memorandum contained incorrect information regarding leasehold rights for certain plots in Gujarat, which misled the resolution plan. The Appellant highlighted that the lease deed executed in 2005 was misrepresented, and the actual possession was under a license agreement rather than a lease. The Appellant sought a stay on the resolution plan's implementation until the status of the assets was clarified. The Respondents contended that there was an ongoing application before the NCLT for further steps in the CIRP process. The Tribunal considered the submissions and referenced a precedent case, deciding that the pending applications should be resolved before any further actions in the CIRP. The Tribunal requested the NCLT to address the issues raised by the parties within two months, allowing the Appellant to seek remedies if the NCLT agreed with their submissions. The appeal was disposed of accordingly.
Headnote
A) Corporate Law - Corporate Insolvency Resolution Process - Misrepresentation in Information Memorandum - Corporate Insolvency Resolution Process, 2016, Section Not mentioned - The Appellant contended that the resolution plan was based on incorrect information regarding leasehold rights, which warranted a stay on the implementation of the plan. The Tribunal directed that the issues raised be decided afresh by the NCLT before further steps in the CIRP process are taken, ensuring all rights and contentions are preserved. Held that the NCLT should resolve the issues within two months (Paras 12-13).
Issue of Consideration
Whether the forfeiture of the bank guarantee was justified given the alleged misrepresentation in the Information Memorandum.
Final Decision
The Tribunal disposed of the appeal, directing the NCLT to decide the issues raised by the parties afresh prior to the decision in I.A No. 157 of 2026, preferably within two months.
Law Points
- Corporate Insolvency Resolution Process
- Misrepresentation
- Bank Guarantee Forfeiture
- Leasehold Rights
