NCLAT Delhi Halts Operation of NCLT Order Rejecting CoC-Approved Resolution Plan in AKB Ventures LLP Matter
Background of the Insolvency Proceedings
The appeal before the National Company Law Appellate Tribunal (NCLAT), Delhi arose from an order dated 21.07.2026 issued by the National Company Law Tribunal (NCLT), Chandigarh Bench (Court-II) in IA No.4 (CH)/2025. The order under challenge had declined approval to the Resolution Plan submitted by AKB Ventures LLP in relation to the corporate insolvency resolution process (CIRP) of Paytail Commerce Private Limited.
The Committee of Creditors (CoC) of Paytail Commerce Private Limited had already approved the Resolution Plan with a voting share of 83.97%, well above the statutory threshold required under the Insolvency and Bankruptcy Code, 2016 (IBC). Despite this substantial majority in favour, the Adjudicating Authority refused to approve the plan, which led AKB Ventures LLP to approach the NCLAT.
Core Issue Before NCLAT
Basis of NCLT Rejection
The primary ground on which the NCLT rejected the Resolution Plan was linked to the status of the Appellant, AKB Ventures LLP, and the nature of its claim. The Adjudicating Authority treated AKB Ventures LLP as an unsecured financial creditor that allegedly fell within the category of a “related party” of the corporate debtor. The claim amount of the Appellant was recorded as Rs.11,12,50,000/-.
In addition, there was a specific observation by the NCLT regarding the issuance of shares to the Appellant. The Appellant had been allotted shares for a consideration of Rs.1,10,850/-, and the Adjudicating Authority disapproved this share issuance on the reasoning that the shares had been issued at a very low price. This aspect formed a crucial part of the NCLT’s reasoning while discarding the Resolution Plan.
Appellant’s Contention on Share Issuance and Valuation
On behalf of AKB Ventures LLP, it was argued before the NCLAT that the Adjudicating Authority had erred in questioning the validity of the share issuance solely on the basis of its low valuation. The Appellant placed reliance on:
- Regulation 37 of the IBC
- Section 2(81) of the Companies Act
- Section 2(h) of the Securities Contracts (Regulation) Act, 1956
According to the Appellant, these provisions collectively allowed the structuring of a Resolution Plan which could include various forms of restructuring, including issuance or transfer of shares. The counsel submitted that, in this framework, the valuation attributed to the shares in question was not a determinative consideration for the legality of the issuance itself, and therefore the NCLT’s adverse view on low valuation was misplaced.
The Appellant’s stand was that it had acted within the contours of law, and the rejection of the Resolution Plan—despite CoC approval of 83.97%—on the limited ground of alleged low share value and categorisation as a “related party” was unsustainable.
Intervention by Another Financial Creditor
Appearance of Cholamandalam Investment and Finance Company
During the proceedings before the NCLAT, another financial creditor, namely Cholamandalam Investment and Finance Company, appeared through Mr. Anand Chibber, Learned Senior Counsel.