Extension of Payment Time Is Not Plan Modification: NCLAT Delhi Sets Aside NCLT Orders Against Successful Resolution Applicant of Allied Strips Limited
In GP Global Energy Private Limited Vs Sandeep Mahajan & Anr., the National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, dealt with a question that arises often once a resolution plan has been approved: can the adjudicating authority allow more time for the promised payments, or does that amount to rewriting the plan? The Tribunal held that seeking an extension of payment time is materially different from seeking a modification of an approved plan. This note summarises the decision, which is reproduced in part in the source.
Background of the Appeals
The Successful Resolution Applicant (SRA) for Allied Strips Limited, GP Global Energy Private Limited (now known as Nivaya Resources Private Limited), filed two appeals, Company Appeal (AT) (Insolvency) No. 954 of 2021 and No. 1011 of 2021. Both challenged orders of 01.11.2021 passed by the National Company Law Tribunal (NCLT), Principal Bench, New Delhi, as the adjudicating authority.
- Appeal No. 954 of 2021 was directed against the order disposing of C.A. No. 2357/2019 and C.A. No. 1170/2019 filed by the SRA.
- Appeal No. 1011 of 2021 was directed against the order disposing of C.A. No. 1246/2019, filed by the Monitoring Professional (Respondent No. 1) under Section 74(3) of the Insolvency and Bankruptcy Code, 2016 (IBC).
Sequence of Events
The Corporate Insolvency Resolution Process (CIRP) of Allied Strips Limited began on an application by Oriental Bank of Commerce under Section 7 of the IBC.