NCLT Restores Kanara Consumer Products' Insolvency Petition Against India Green Reality

The Ahmedabad Bench of the National Company Law Tribunal (NCLT) has recently restored an insolvency petition filed by Kanara Consumer Products Limited, formerly known as Kurlon Limited, against India Green Reality Limited.

It held that the condition for revival had been fulfilled after the NCLAT set aside the admission order in a connected insolvency petition and the Supreme Court dismissed the subsequent challenge.

A Bench of Judicial Member Chitra Hankare and Technical Member Dr. V. G. Venkata Chalapathy observed, “Thus, the contingency contemplated in the order dated 22.12.2023 has arisen.”

The dispute arose from an insolvency petition filed by Kanara Consumer Products against India Green Reality. On December 22, 2023, the NCLT disposed of the petition as infructuous in view of the admission of a connected insolvency petition against the company. However, it granted Kanara Consumer Products liberty to seek revival of its petition if the admission order in the connected proceeding was set aside. The NCLAT subsequently set aside the admission order on January 31, 2025. The Supreme Court dismissed Kanara Consumer Products' challenge to the decision on April 7, 2025.

Seeking restoration of its petition, Kanara Consumer Products relied on the liberty granted by the NCLT. Opposing the application, India Green Reality argued that the revival would reopen interconnected disputes arising from the two insolvency petitions.

These disputes had already been considered by the NCLAT and the Supreme Court. It further contended that the liberty granted earlier did not confer an automatic right to restoration. The applicant would still have to establish a subsisting financial debt and default.

The NCLT observed that the present application was limited to deciding whether the original petition could be revived under its earlier order. It held that the objections concerning the underlying transaction and the existence of a financial debt and default went to the merits of the insolvency petition. These issues could not be decided at the restoration stage.

“At this stage, we are only required to consider whether the petition is liable to be revived pursuant to the liberty granted in order dated 22.12.2023. The contentions of the respondent and response thereto by the applicant require adjudication in the restored proceedings and cannot be conclusively determined in the present application,” the tribunal observed.

It clarified that India Green Reality would remain free to raise its objections and make its arguments when the original insolvency petition was taken up for hearing.

Accordingly, the NCLT restored the insolvency petition and allowed the application.

For Appellants: Advocate Garima Malhotra

For Respondent: Advocates Nipun Singhvi, Pragati Tiwari, and Vishal Dave