Case Overview

The National Company Law Tribunal (NCLT) Chandigarh Bench approved the resolution plan for Safari Bikes Limited, a public limited company incorporated in 1995 and classified as an MSME. The Corporate Insolvency Resolution Process (CIRP) was initiated on 27 July 2022 based on an application filed by operational creditor Emm Aar Traders under Section 9 of the Insolvency and Bankruptcy Code, 2016. Mr. Rajnish Gupta was appointed as the Resolution Professional.

The Committee of Creditors (CoC) consisted solely of State Bank of India (SBI) with an admitted claim of ₹54,10,72,485, representing 100% of the voting share. Total admitted claims amounted to ₹54,13,79,595 against claims of ₹54,51,85,162.

The CIRP witnessed a complex process where initially three resolution plans were received but not voted upon by SBI, leading to liquidation proceedings. However, following interventions by the NCLT through orders dated 18 March 2025 and 8 July 2025, the CoC reconsidered the plans. Ultimately, the consortium of Investrekk Global Research Private Limited and NVR and Associates Limited submitted a revised resolution plan that was approved by the CoC with 100% voting share in its 20th meeting on 6 December 2025.

The resolution plan value is ₹5,31,02,227, which includes CIRP costs of ₹40,00,000. The fair value of the corporate debtor was determined at ₹6,30,68,408 while the liquidation value was ₹4,32,54,205. The plan provides for payment to stakeholders within 180 days from approval date.

Final Outcome

The NCLT approved the resolution plan with the following key provisions:

  • Financial Distribution: SBI will receive ₹4,90,00,000 (9.36% of its admitted claim) payable in three tranches: ₹1 crore within 15 days, ₹1.5 crore within 90 days, and ₹2.6 crore within 180 days of NCLT approval
  • Operational Creditors: EPFO will receive full payment of ₹2,227 within 15 days; other operational creditors will receive ₹1,00,000 (32.80% of admitted claims)
  • CIRP Costs: ₹40,00,000 payable, with additional ₹1,00,000 per month from 1 October 2025 towards RP fees
  • Management Changes: Existing equity share capital stands extinguished; resolution applicant will subscribe to 25,00,000 equity shares at par value, acquiring 100% control
  • New Directors: Mr. Narinder Kumar Gaba, Mr. Vijay Kumar Gaba, and Mrs. Radhika Gaba will be appointed as directors
  • Monitoring Committee: Will supervise implementation comprising RP as chairperson, one nominee from financial creditor, and one representative from resolution applicant
  • Moratorium: The moratorium imposed on 27 July 2022 under Section 14 of the Code ceases to have effect
  • Liabilities Extinguished: All pre-CIRP liabilities, claims, and obligations stand extinguished as per the Supreme Court's judgment in Ghanshyam Mishra case

The tribunal directed that reliefs sought regarding carry-forward of losses and other tax benefits should be pursued with the concerned statutory authorities, and the resolution applicant must implement the plan regardless of whether such reliefs are granted.

Topics: Corporate Insolvency, Resolution Plan Approval, Debt Restructuring