Authority: National Company Law Appellate Tribunal Principal Bench, New Delhi
Order Date: 29 June 2026
Case Overview
This appeal challenges an order admitting Corporate Debtor Distribution Logistics Infrastructure Private Limited to Corporate Insolvency Resolution Process (CIRP) under Section 7 of the Insolvency and Bankruptcy Code. The total debt owed by the Corporate Debtor to a consortium of banks exceeds ₹900 crores. The appellant, Sudarshan Aithal (Suspended Director of Distribution Logistics Infrastructure Private Limited), is seeking to settle the matter outside of CIRP.
The key development is that lender banks have identified an Asset Reconstruction Company (ARC) for assignment of the debt for ₹621 crores. The appellant has made a superior offer of ₹631 crores to settle the debt entirely. During previous proceedings before the Vacation Bench on 15 June 2026, the appellant had proposed depositing 50% of ₹631 crores. However, the Committee of Creditors (CoC) rejected this offer as it was conditional.
Final Outcome
The NCLAT has directed the appellant to deposit 50% of ₹631 crores (₹315.5 crores) with the Registrar NCLAT on or before 09 July 2026 as the first installment, and the remaining 50% by 20 July 2026. This order is made without prejudice to the rights of the respondents (Bank of India & Anr.) and the CoC to accept or reject the appellant's settlement proposal. The matter has been listed for next hearing on 22 July 2026 for further consideration.
The tribunal noted the CoC's loss of trust in the appellant due to their conduct in dilly-dallying recovery proceedings both before and after the commencement of CIRP, but considered the financial merit of the appellant's offer being ₹10 crores higher than the ARC's offer.
Topics: Insolvency Appeal, Debt Settlement, Committee of Creditors