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

Order Date: 15/06/2026

Case Overview

This application was filed by Mr. Ravi Sethia, Resolution Professional of Wind World (India) Limited (Corporate Debtor), under Section 25(2)(j) read with Sections 43(1), 45(1) and 66(1) of the Insolvency and Bankruptcy Code, 2016. The Corporate Insolvency Resolution Process was commenced against the Corporate Debtor on 20.02.2018. The Resolution Professional appointed Grant Thornton India LLP as Transaction Auditors, who identified three categories of suspect transactions in their report dated 20.10.2018:

1. A preferential transaction involving sale of cranes by the Corporate Debtor to SREI Equipment Finance Limited (Respondent No.2) for INR 18.22 Crores on or about 04.10.2016, with subsequent routing of funds to Wind World Wind Resources Development Private Limited (Respondent No.1) for repayment obligations, while the Corporate Debtor retained possession and use of the cranes.

2. An undervalued transaction concerning downward revision of Operation and Maintenance charges payable by Wind World Wind Farms (Hindustan) Private Limited (Respondent No.3) from approximately INR 0.94 Crores to INR 0.30 Crores annually during Financial Year 2014-15, potentially resulting in undercharging of approximately INR 3.00 Crores over the remaining contractual period till Financial Year 2025-26.

3. Fraudulent transactions involving utilization of Corporate Debtor's funds for personal legal expenses of suspended directors Mr. Yogesh Mehra and Mr. Ajay Mehra (Respondent Nos.4 and 5) concerning disputes initiated by Enercon GmbH, with Respondent No.4 having repaid INR 55,20,243/- during proceedings.

All Respondents raised preliminary objections regarding maintainability of the composite application, alleged non-application of mind by the Resolution Professional, non-compliance with Regulation 35A timelines, and contended that the proceedings could not survive after rejection of the Resolution Plan on 24.08.2022.

The Tribunal rejected all preliminary objections, holding that: (i) composite applications are permissible under IBC; (ii) reliance on Transaction Audit Report does not demonstrate non-application of mind; (iii) Regulation 35A timelines are directory, not mandatory; and (iv) avoidance proceedings survive independently of resolution plan approval.

Final Outcome

The Tribunal partly allowed the application with specific findings:

  • The crane transaction was declared a preferential transaction under Section 43. Respondent Nos.1 and 2 were directed to jointly and severally restore INR 18.22 Crores with 9% interest from transaction date till realization within 30 days. They were also directed to release all charges/encumbrances on the cranes within 15 days and compensate the Corporate Debtor at fair market value if assets were alienated.
  • The O&M charge revision was held not to constitute an undervalued transaction as the amendment was made in August 2014 (outside the look-back period) and was in the ordinary course of business.
  • The personal legal expenses transaction was declared fraudulent under Section 66. Respondent Nos.4 and 5 were directed to jointly and severally compensate the Corporate Debtor for all amounts utilized with 9% interest within 30 days, with credit to be given for the INR 55,20,243/- already repaid after verification.

The Resolution Professional was directed to take immediate steps for recovery and restoration of assets, with banks and authorities directed to provide necessary cooperation.

Topics: Insolvency Avoidance Proceedings, Preferential Transactions, Director Liability