NCLT Indore Dismisses Union Bank's Plea To Include Four Belated EOIs In JSM Devcons CIRP
The Indore National Company Law Tribunal (NCLT) dismissed Union Bank of India's plea seeking inclusion of four belated EOIs in the Corporate Insolvency Resolution Process (CIRP) of JSM Devcons India Pvt. Ltd.
A Bench comprising Judicial Member Brajendra Mani Tripathi and Technical Member Man Mohan Gupta held that the Committee of Creditors (CoC), having rejected belated Expressions of Interest (EOIs) by majority vote, acted within its commercial wisdom, which is paramount under the Insolvency and Bankruptcy Code (IBC). It held:
“The commercial interest which falls for consideration is not that of the Applicant alone, but of all the creditors of the Corporate Debtor, and it is to be decided by the collective majority. An individual creditor cannot question a decision which has been taken by the majority of the Committee of Creditors.”
JSM Devcons India Pvt. Ltd. was admitted into CIRP in April 2019. Union Bank of India, the sole secured financial creditor holding a 23.95% voting share, had sanctioned a Rs. 30 crore loan secured against 51.79 acres of project land.
The Resolution Professional (RP), Chhaya Gupta, issued Form-G on 6 October 2025 inviting EOIs, with 21 October 2025 as the deadline. Only two EOIs were received within the prescribed timeline.
Thereafter, Aranath Real Estate Pvt. Ltd., Aikyam Stressed Assets Trust, Permanent Multitrade LLP and Authum Investment & Infrastructure Ltd. submitted complete EOIs after the deadline. The EOIs included Section 29A declarations, corporate credentials and undertakings to comply with CIRP requirements. It was submitted that the delay was neither deliberate nor substantial.
The RP rejected the four EOIs solely because they were received after the stipulated deadline. The matter was subsequently placed before the CoC. Union Bank of India argued that their inclusion was necessary to broaden competition and maximise value for creditors. However, the CoC rejected the proposal.
Union Bank of India argued that Regulation 36A(6), which provides for rejection of EOIs received after the stipulated timeline, should not be interpreted rigidly. It contended that excluding financially capable applicants solely on procedural grounds would undermine the objectives of the IBC.
The bank further submitted that the CoC had not applied its mind comprehensively while rejecting the belated EOIs. It also argued that, as the sole secured creditor, its statutory rights under Sections 52 and 53 of the IBC could be gravely compromised if the CIRP proceeded with a narrowed competitive field.
The Bench noted that the four EOIs were admittedly submitted after the stipulated deadline. It also noted that the RP had placed the issue before the CoC at its 22nd meeting, where 74.89% of the voting share supported rejection of the belated EOIs, with Union Bank of India alone voting in favour of their inclusion.
It further noted that the CoC had decided that the CIRP should continue by considering only the two EOIs received within the prescribed timeline.
The Tribunal emphasised that the CoC's commercial wisdom is paramount under the IBC and is not ordinarily open to judicial interference. Even assuming that Regulation 36A(6) did not operate as an absolute bar, the CoC had exercised its discretion and declined to consider the belated EOIs.
It also held that Union Bank of India lacked locus standi to plead on behalf of the four prospective applicants, none of whom had approached the Tribunal challenging the rejection of their EOIs. It reiterated that CIRP decisions must reflect the collective interests of creditors rather than the commercial concerns of an individual creditor.
Accordingly, the NCLT dismissed Union Bank of India's application.
For Appellants: Advocate Deepak Saxena