Case Details

Case Name: Canara Bank vs Mansarovar Pearls (India) Pvt Ltd.

Court/Authority: National Company Law Tribunal, Hyderabad Bench - 1

Case Number: CP(IB) No. 53/7/HDB/2025 and IA (IBC) (Plan) 02/2026

Date of Order: 21 May 2026

Period of Dispute: Corporate Insolvency Resolution Process (CIRP) initiated on 28 November 2025

Parties Involved

Financial Creditor/Petitioner: Canara Bank

Corporate Debtor/Respondent: Mansarovar Pearls (India) Pvt Ltd.

Interim Resolution Professional: Mr. Truvisory Insolvency Professional Private Limited (initial appointment)

Resolution Professional: Mr. Dommeti Surya Rama Krishna Saibaba (appointed later)

Successful Resolution Applicant: Mr. Piyush Agarwal

Adjudicating Authority Members: Shri Rajeev Bhardwaj (Hon'ble Member - Judicial), Shri Sanjay Puri (Hon'ble Member - Technical)

Issues / Allegations / Violations

The case involved the corporate insolvency of Mansarovar Pearls (India) Pvt Ltd. initiated under Section 7 of the Insolvency and Bankruptcy Code, 2016 by Canara Bank as financial creditor. The total admitted claims amounted to Rs. 59,92,42,840.00, comprising:

  • Secured Financial Creditor (Canara Bank): Rs. 54,09,89,230.00
  • Operational Creditors: Rs. 5,82,63,610.00

The corporate debtor was unable to meet its financial obligations, leading to the initiation of insolvency proceedings.

Findings & Observations

The Tribunal found that:

  • The Resolution Plan submitted by Mr. Piyush Agarwal complied with all requirements of Section 30(2) of the IBC and Regulations 37, 38, 38(1A) and 39(4) of the CIRP Regulations
  • The Committee of Creditors (comprising solely of Canara Bank with 100% voting share) approved the plan with 100% voting share in its 4th meeting held on 04.04.2026
  • The Resolution Applicant met the eligibility criteria under Section 29A of the Code
  • The plan provided for payment of CIRP costs in priority as required by Section 30(2)(a)
  • The commercial wisdom of the CoC must be respected with minimal judicial interference, as established in multiple Supreme Court precedents including Sashidhar v. Indian Overseas Bank and Essar Steel cases

Penalties / Settlements / Directions

The Resolution Plan provides for:

  • Total resolution amount: Rs. 2,07,46,420/- (including CIRP costs of approximately Rs. 7,41,420/-)
  • Distribution to stakeholders:
  • Secured Financial Creditor (Canara Bank): Rs. 2,00,00,000/- (3.70% recovery on admitted claims)
  • Operational Creditors: Rs. 5,000/- (0.0% recovery on admitted claims)
  • CIRP Expenses: Rs. 7,41,420/- (100% payment)
  • Haircut for financial creditors: 96.3%
  • The SRA deposited performance security of Rs. 20,00,000/- (10% of plan amount)

Corrective Actions & Future Obligations

  • The entire plan amount must be paid within 30 days from the date of communication of this approval order
  • In case of failure, an additional cure period of 60 days is provided for payment with interest @ 9% per annum on delayed payments
  • A Monitoring Committee will be constituted comprising: (i) the Resolution Professional, (ii) one representative of the CoC member, and (iii) one representative of the Resolution Applicant to oversee implementation
  • The Memorandum of Association and Articles of Association shall be amended as required and filed with the Registrar of Companies, Hyderabad
  • The Resolution Applicant must obtain all necessary approvals under applicable laws for effective implementation

Final Ruling & Enforcement

The Tribunal:

  • Approved the Resolution Plan submitted by Mr. Piyush Agarwal for Rs. 2,07,46,420/-
  • Ordered that the plan shall be binding on the corporate debtor, its employees, members, creditors, guarantors and other stakeholders
  • Declared that all crystallized and unclaimed liabilities of the corporate debtor as on the date of this order shall stand extinguished
  • Stated that statutory obligations/liabilities are not waived and shall be dealt with by appropriate authorities
  • Ordered that the performance security of Rs. 20,00,000/- shall remain as guarantee until the plan is fully implemented
  • Directed that the moratorium under Section 14 of the Code shall cease to have effect from this date
  • Ordered the Resolution Professional to forward all records to the IBBI and send copies of the order to the CoC and Resolution Applicant
  • Directed the Registry to communicate the order to the Registrar of Companies, Hyderabad and IBBI
  • Required the Monitoring Committee/Resolution Professional to submit an implementation report to the Registry