Case Details

  • Case name: Cosmic CRF Limited vs Myotic Trading Private Limited & Ors.
  • Court/Authority: Supreme Court of India, Civil Appellate Jurisdiction.
  • Appeal numbers: Civil Appeal Nos. 4266‑4267 of 2026 and 6684 of 2026.
  • Order date: 14 May 2026.
  • Dispute context: Challenges to NCLAT judgments that declared Cosmic CRF Ltd ineligible under Section 29A(c) and (j) of the Insolvency and Bankruptcy Code, 2016, in the Corporate Insolvency Resolution Process (CIRP) of Amzen Transportation Industries Pvt Ltd.

Parties Involved

  • Appellant: Cosmic CRF Limited (prospective resolution applicant).
  • Respondent No.1: Myotic Trading Private Limited (member of a former consortium with Fortune Global Solution Pte Ltd).
  • Respondent No.7: Fortune Global Solution Pte Ltd (withdrawn from the consortium).
  • Respondent No.2: Resolution Professional appointed by the NCLT on 04‑05‑2022.
  • Respondent No.3: Committee of Creditors (CoC) of the corporate debtor, comprising:
  • Prudent ARC Ltd (41.12% voting rights)
  • UCO Bank (53.31% voting rights)
  • WLD Investments Pvt Ltd (5.57% voting rights)
  • Other entities mentioned: AHSK & Co. (Chartered Accountant firm), Priyanka Sharma & Associates (CA firm), various senior advocates and counsel (Mukul Rohtagi, C.A. Sundaram), and the two Supreme Court judges J.B. Pardiwala and Ujjal Bhuyan.

Issues / Allegations / Violations

  • NCLAT held Cosmic CRF Ltd ineligible under Section 29A(c) alleging a shortfall/hair‑cut suffered by financial creditors of Cosmic Ferro Alloys Ltd (CFAL), where the appellant’s connected person, Managing Director Aditya Vikram Birla, held a 0.09% shareholding and his father Ravi Birla was the promoter when CFAL was classified as an NPA in 2016.
  • NCLAT also relied on Section 29A(j), asserting that the appellant’s connected person was ineligible, thereby rendering the appellant ineligible.
  • Additional allegations included: (i) alleged employment of Aditya Vikram Birla as a marketing executive of CFAL after its resolution plan; (ii) acquisition of CFAL’s Singur unit by the appellant on a slump‑sale basis for ₹49 crore, purportedly creating a connection with the QVC Consortium that had taken over CFAL.
  • The core legal question: whether ineligibility under Section 29A(c) should be assessed on the date of resolution‑plan submission (28‑06‑2024) and whether any outstanding NPA liability persisted.

Findings & Observations

  • The Court examined the language of Section 29A(c) – “at the time of submission of the resolution plan” – and relied on ArcelorMittal India Private Limited v. Satish Kumar Gupta (2019 2 SCC 1) to conclude that eligibility is determined on the plan‑submission date, not on earlier dates.
  • CFAL’s resolution plan was approved on 11‑10‑2018; the NPA was upgraded to “Standard” and all dues of financial creditors were extinguished under Section 31 of the IBC. Consequently, no overdue amounts existed on 28‑06‑2024.
  • The Court found that Aditya Vikram Birla’s 0.09% shareholding and his father’s prior promoter status did not constitute “management or control” of CFAL at the relevant date, citing Swiss Ribbons Private Limited v. Union of India (2019 4 SCC 17) and Eva Agro Feeds (P) Ltd. v. Punjab National Bank (2023 10 SCC 189).
  • The first proviso of Section 29A(c) (payment of overdue amounts) was held inapplicable because there were no outstanding dues.
  • The claim that the appellant remained connected to the QVC Consortium or that Birla continued as a marketing executive was rejected; the appellant acquired a separate unit of CFAL on an arm’s‑length basis four years after the resolution plan, and the parties remain distinct legal entities.
  • Myotic Trading withdrew its objection on 22‑08‑2025, leaving no party contesting the appellant’s eligibility.

Penalties / Settlements / Directions

  • No monetary penalties were imposed.
  • The two NCLAT orders (First Impugned Order dated 25‑07‑2025 and Second Impugned Order dated 12‑03‑2026) were set aside.
  • All consequential actions, including the publication of a fresh Form‑G and any related procedural steps, were declared null and void.

Corrective Actions & Future Obligations

  • Cosmic CRF Ltd is declared eligible to participate in the CIRP of Amzen Transportation Industries Pvt Ltd.
  • The appellant’s resolution‑plan proceedings shall be processed by the CoC in accordance with the law.
  • Any pending applications related to the impugned orders are disposed of.

Final Ruling & Enforcement

  • The Supreme Court allowed both appeals, set aside the NCLAT judgments, and affirmed the appellant’s eligibility under Section 29A.
  • The order directs that the fresh Form‑G and all subsequent actions taken pursuant to the impugned orders be cancelled.
  • All pending applications, if any, stand disposed of.
  • The judgment is signed by Justices J.B. Pardiwala and Ujjal Bhuyan.