Whether, after approval of Resolution Plan and issuance of LoI, an Unsuccessful Resolution Applicant can question the conduct of the Committee of Creditors(CoC) and challenge Resolution Plan of Successful Resolution Applicant(SRA) – Dhansagar Dealers Pvt. Ltd. Vs. Mr. Anubrata Gangoly, RP of Carnation Industries Ltd. – NCLT Kolkata Bench
In this important judgment, while approving resolution plan in the matter of Carnation Industries Ltd., Bench of Kolkata NCLT comprising of Ms. Bidisha Banerjee and Shri Arvind Devanathan, has held that:
(i) Any modifications or revisions of any plan after the approval of the plan by the CoC, even if undertaken as per directions of the CoC, shall not be entertained unless the CoC grants the subsequent approval.
(ii) An unsuccessful resolution applicant has no vested right to challenge the approval of a resolution plan.
(iii) The approval of Resolution Plan falls within the arena of “commercial wisdom” which cannot be questioned unless there is a violation of law as enshrined under Sections 30(2) and 31 of the I&B Code.
(iv) Once a resolution applicant fails to succeed in the bid, it neither has a locus to question the action of the stakeholders qua members sitting in and controlling the CoC, nor the right to enhance or revise the monetary value of its Resolution Plan to compete with the plan of the Successful Resolution Applicant.