Authority: Supreme Court of India, Civil Appellate Jurisdiction

Order Date: 26 October 2026

Case Overview

  • Parties: Appellants – Bank of India & others; Respondents – S.M. Kamal Pasha & others, including the Resolution Professional (RP) and the holding company of the corporate debtor (CD).
  • Issue: Whether the Committee of Creditors (CoC), after approving a resolution plan under the Insolvency and Bankruptcy Code, 2016 (IBC), can seek withdrawal of that plan before the Adjudicating Authority (National Company Law Tribunal – NCLT) on the ground that the CD’s financial position has improved.
  • Background: The approved resolution plan required a resolution amount of Rs.172.55 crores when the CD’s opening balance was Rs.30 crores. By the time of earlier Supreme Court proceedings, the opening balance had risen to Rs.165 crores, creating a perceived windfall for the Successful Resolution Applicant (SRA).
  • Arguments: The CoC, supported by the RP, argued that improved financial health of the CD justified withdrawal to avoid a reduced infusion by the SRA. The holding company sought a One‑Time Settlement (OTS) and the closure of the CIRP. The SRA contended that the plan is binding once approved by the CoC and that improvement was already contemplated.
  • Legal Precedents Cited: Ebix Singapore (P) Ltd. v. Committee of Creditors of Educomp Solutions Ltd. (2022) 2 SCC 401; State Bank of India v. Consortium of Murari Lal Jalan (2025) 4 SCC 354; Kalyani Transco v. Bhushan Power & Steel Ltd. (2026) 6 SCC 431; Glas Trust Company LLC v. Byju Raveendran (2024) SCC Online 3032; and the Insolvency Law Committee Report (March 2018).
  • Statutory Provisions Discussed: Section 12‑A (withdrawal power), Regulation 30‑A (withdrawal procedure), Section 30(4) (66% vote for plan approval), Section 31 (approval by AA), Section 74 (penalties for non‑compliance), and Explanation I & II to Section 30.
  • Findings: The Court held that the CoC’s jurisdiction ends with the approval of the plan; it cannot unilaterally withdraw after the plan is approved. Withdrawal under Section 12‑A, even with 90% CoC consent, only obliges payment of CIRP costs and does not entitle the SRA to damages. The binding effect of the plan persists irrespective of subsequent financial improvements of the CD.

Final Outcome

  • The Supreme Court dismissed the appeal, confirming that the CoC cannot withdraw the approved resolution plan.
  • It directed that the pending NCLT applications – one for confirmation of the resolution plan and another by the holding company for an OTS – be heard together and decided expeditiously.
  • The Court stated that any pending applications, if any, shall stand rejected, and it refrained from interfering with the NCLT’s ultimate adjudication beyond the observations made.

Topics: Insolvency, Resolution Plan, Committee of Creditors