Authority: National Company Law Tribunal, Division Bench, Court - 1, Ahmedabad

Order Date: 09/06/2026

Case Overview

This order pertains to an application (IA/880(AHM)2026) filed by the Resolution Professional (RP) of K-Lifestyle & Industries Ltd under Sections 12 and 60(5)(c) of the Insolvency and Bankruptcy Code, 2016 (IBC), read with Rule 11 of the NCLT Rules, 2016. The application sought the exclusion of 1,853 days from the Corporate Insolvency Resolution Process (CIRP) period of the Corporate Debtor, K-Lifestyle & Industries Ltd, and a consequential 90-day extension of the CIRP. The corporate debtor was admitted into CIRP on 05.02.2020 pursuant to CP(IB) No. 625 of 2018, initiated by financial creditor UCO Bank.

The principal reason for seeking exclusion was that the CIRP was severely hampered by multiple judicial proceedings and external circumstances. Key among these were:

  • Proceedings concerning the constitution of the Committee of Creditors (CoC) and the determination of voting rights of certain creditors, which remained pending before the Adjudicating Authority (NCLT) and the National Company Law Appellate Tribunal (NCLAT).
  • A specific order dated 02.03.2021 in IA No. 69 of 2021 directed the RP and CoC not to proceed further with the CIRP.
  • This order was challenged before the NCLAT in Company Appeal (AT) (Ins.) No. 404 of 2021, which granted an interim stay on all CIRP proceedings on 14.06.2021. The appeal was ultimately disposed of on 04.10.2023, with the matter remanded for fresh adjudication.
  • A separate restraint order dated 14.06.2021 in IA No. 375 of 2021 prevented the RP and CoC from proceeding with a vote on the liquidation agenda. This restraint remained in force until the disposal of that application on 07.04.2026.
  • Additionally, CIRP activities were affected by COVID-19 related restrictions.

The applicant argued that these factors represented circumstances beyond the control of the RP and the CoC, preventing the effective utilization of a substantial portion of the CIRP timeline. The application was supported by a resolution from the CoC, which authorized the RP to seek this exclusion. The resolution was approved in the CoC's 8th meeting held on 30.04.2026 and was subsequently ratified through e-voting concluded on 12.05.2026 with 75.65% of the voting share in favor.

Final Outcome

The NCLT bench, comprising Member (Technical) Sanjeev Sharma and Member (Judicial) Shammi Khan, allowed the application. The tribunal observed that the CIRP remained affected due to the outlined judicial proceedings and orders, and that the period during which the process could not progress deserved exclusion. Consequently, the full period of 1,853 days, as prayed for, was officially excluded from the CIRP timeline of K-Lifestyle & Industries Ltd. The Resolution Professional was directed to proceed with the CIRP in accordance with the IBC and its regulations, which includes steps like the re-publication of Form G and the invitation of fresh Expressions of Interest. The application was disposed of with no order as to costs.

Topics: Insolvency, Litigation