Case Details

Case Name: IA(IBC)/41/2022 in CP(IB) No. 12/10/HDB/2017

Parties: M/s. SS Rail Works Pvt. Ltd. (Applicant) vs. M/s. VNR Infrastructure Limited (Under Liquidation) represented by Liquidator Mr. T.S.N. Raja (Respondent)

Court/Authority: National Company Law Tribunal, Hyderabad Bench-II

Date of Order: 20 May 2026

Period of Dispute: Subcontract agreement dated 29 September 2016, contract terminated on 23 May 2018

Parties Involved

Petitioner/Applicant: M/s. SS Rail Works Pvt. Ltd., represented by its Chief Executive Officer Mr. A. Srinivasulu Reddy

Respondent: M/s. VNR Infrastructure Limited (under liquidation), represented by its Liquidator Mr. T.S.N. Raja

Key Officials: Shri Rajeev Bhardwaj (Member Judicial), Shri Sanjay Puri (Member Technical)

Issues / Allegations / Violations

  • Applicant sought direction to liquidator to accept measurements and final bills for Rs 92,37,130/- for subcontract work executed under North East Frontier Railway contract
  • Applicant alleged liquidator received Rs 16.88 crore from NFR for work executed but paid only Rs 14.44 crore, leaving balance of Rs 2.43 crore
  • Subcontract agreement dated 29.09.2016 valued at Rs 34,34,78,002/- for construction of substructure of major bridges in Tripura
  • Applicant completed 65% of work, received Rs 1,89,87,547/- in on-account bills
  • NFR terminated contract on 23.05.2018 due to corporate debtor's liquidation
  • Liquidator alleged applicant caused losses exceeding Rs 10 crore including BG invocation and EMD forfeiture

Findings & Observations

  • Tribunal noted corporate debtor was sold as "going concern" on 09.03.2020 for Rs 12,48,70,000/- approved on 07.07.2021
  • Liquidator not functus officio despite sale, must complete residual liquidation functions including reconciliation
  • Dispute involves complex issues of measurement certification, PVC bills, stock reconciliation, materials, equipment, royalty terms
  • Related matters pending before NCLAT: Company Appeal (AT) (Ins) No. 438 of 2019 and TA (AT) No. 176 of 2021
  • Royalty dispute: Liquidator claimed 6-8% royalty while applicant stated pre-CIRP royalty was 2-3.5%
  • Equipment possession dispute: Liquidator alleged applicant failed to return equipment valued by engineers, police complaint lodged

Penalties / Settlements / Directions

  • Application dismissed for substantive reliefs seeking mandatory directions to liquidator
  • Limited direction: Liquidator to include subject matter in project-wise and litigation-wise status report as directed in IA No.742/2021
  • Liquidator to make available/hand over any available records to present management of corporate debtor
  • No monetary penalties or settlements ordered

Corrective Actions & Future Obligations

  • Liquidator must prepare comprehensive project-wise and litigation-wise status report
  • Complete reconciliation of receivables, contractual claims, retained amounts and liabilities
  • Proper accounting, reporting and reconciliation of liquidation estate
  • Transmission of available records to present management of corporate debtor

Final Ruling & Enforcement

  • Application dismissed subject to observations and limited directions
  • Dismissal not construed as adjudication on merits of applicant's claim
  • Applicant liberty to pursue remedies against corporate debtor under present management/successful going-concern purchaser
  • All rights and contentions of parties left open
  • Matters to be pursued before appropriate contractual, statutory or competent forum including Railway Authorities