NCLT Chennai Approves Pothys Retail's ₹43.02 Crore Resolution Plan For Arihant Retail
The National Company Law Tribunal at Chennai has approved a resolution plan submitted by Pothys Retail Private Limited for Arihant Retail Private Limited, holding that the plan complies with the Insolvency and Bankruptcy Code and the applicable CIRP Regulations.
A coram of Judicial Member Sanjiv Jain and Technical Member Venkataraman Subramaniam approved the plan after noting that the Committee of Creditors had unanimously approved it with 100% of the voting share.
Arihant Retail, an MSME engaged in the textile retail business, had initiated its own corporate insolvency resolution process after suffering losses following the COVID-19 lockdown. The CIRP was admitted by the Tribunal on May 2, 2025.
After the CoC rejected the earlier resolution plans and proposed liquidation of the company, the CIRP was restored by the Tribunal to provide prospective resolution applicants an opportunity to submit enhanced plans. Pothys Retail's plan was subsequently approved by the CoC.
The resolution plan has a total value of ₹43.02 crore, excluding CIRP costs and trade receivables retained by secured financial creditors. It provides for payment of ₹65 lakh towards CIRP costs, ₹42.25 crore for secured financial creditors and ₹12 lakh for operational creditors. Pothys Retail has also proposed an additional infusion of ₹15 crore towards capital expenditure and working capital funds.
The Tribunal reiterated that its jurisdiction while considering a resolution plan is limited. It examined the documents on record and held:
“…we are satisfied that the Resolution Plan is in accordance with sections 30 and 31 of the IBC. It also complies with regulations 38 and 39 of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016.”
The Tribunal accordingly approved the plan and held that it would be binding on the corporate debtor and other stakeholders.
The Tribunal also considered the reliefs and concessions sought under the plan. While certain requests were granted, some were refused, and several tax and statutory reliefs were left to the appropriate authorities to consider.
For Applicant: Advocate Raghav Menon