Key Details of the NCLAT Order

The Hon'ble NCLAT, Principal Bench, New Delhi, passed an order dated 24 June 2026 in Company Appeal (AT) (Insolvency) No. 1081 of 2026.

Parties Involved

  • Appellant: Paramjeet Singh (Suspended Managing Director of Oswal Overseas Ltd.)
  • Respondents: L H Sugar Factories Ltd. & Anr. (including the Interim Resolution Professional)

Salient Features of the Order

During the proceedings, it was brought to the NCLAT's notice that an amicable settlement had been arrived at between Oswal Overseas Limited and L H Sugar Factories Limited. A copy of the settlement agreement along with consent terms was placed on record via an application bearing diary No. 68726.

Counsel for both the Appellant and Respondent No. 1 jointly requested that the Corporate Insolvency Resolution Process (CIRP) initiated by the impugned order be closed in light of this settlement. They argued that the pendency of CIRP proceedings was an abuse of the process of law.

Counsel for the Interim Resolution Professional (IRP) submitted that, in pursuance of the impugned order, he had received two claims: one financial and one operational.

The NCLAT observed that, in view of the provisions of Section 12A of the Insolvency and Bankruptcy Code, 2016 read with Regulation 30A of the CIRP Regulations, 2016, the parties would be required to approach the Adjudicating Authority (NCLT) for formal withdrawal of the CIRP. The tribunal cited the law laid down by the Hon'ble Supreme Court in Glas Trust Company LLC Vs. Byju Raveendran.

Directions and Next Steps

Pending further consideration, the NCLAT directed that the IRP shall not take any further steps pursuant to the impugned order initiating CIRP until the next date of listing.

The tribunal permitted the IRP to file a reply to the appeal within 4 days from 24 June 2026, with an advance copy to the Appellant's counsel, who may file a rejoinder within 4 days thereafter. Respondent No. 1 was also permitted to file a short reply regarding the settlement within 4 days.

The matter has been listed for further hearing on 08 July 2026.

The order was passed by a bench comprising Justice Mohammad Faiz Alam Khan (Member - Judicial) and Barun Mitra (Member - Technical).

Financial Impact

Financial impact is not quantified in the disclosure. The disclosure pertains to a stay of insolvency proceedings following a mutual settlement.