Unsuccessful Applicant Cannot Demand Re-Voting On Resolution Plan Merely Because Its Plan Was Rejected: NCLT Delhi

The Delhi bench of the National Company Law Tribunal (NCLT) has recently held that an unsuccessful resolution applicant cannot compel the Committee of Creditors (CoC) to reconsider its commercial decision merely because its resolution plan was not approved.

The bench of Judicial Member Mahendra Khandelwal and Technical Member Atul Chaturvedi observed,

“We also find considerable force in the submission of the Respondent that the Applicants cannot seek, through the present Application, a fresh voting process merely because their Resolution Plan was not approved. Participation as a prospective resolution applicant does not confer an entitlement to have one's Resolution Plan accepted or to require the CoC to reconsider its commercial decision merely because the Applicant is dissatisfied with the outcome.“

The application was filed by AKB Ventures LLP and Sustainable Projects Private Limited, unsuccessful prospective resolution applicants (PRAs) in the corporate insolvency resolution process (CIRP) of Spaze Towers Private Limited.

The applicants sought to declare the Committee of Creditors (CoC) voting process conducted between 19 October 2025 and 21 October 2025 as null and void, remove the Resolution Professional (RP), appoint a new RP, direct an IBBI investigation, and conduct a fresh voting process.

The dispute arose after the applicants participated in the resolution process pursuant to Form-G issued on 29 May 2025. Two resolution plans were ultimately submitted, one by the applicants' consortium and the other by a consortium allegedly connected with the erstwhile management of the corporate debtor. The competing consortium's plan was approved by the CoC with 96.42% voting share.

They contended that, despite repeated requests, material information necessary for preparation of an effective resolution plan the RP failed to provide them. They pointed out the discrepancies in the virtual data room (VDR).

It was contended that this amounted to a violation of natural justice and procedural fairness and established collusion with the ex-directors, as the RP has a statutory duty under Section 25(2)(g) of the Code and Regulation 36 of the CIRP Regulations to provide all PRAs equal access to relevant information and ensure a fair and competitive process.

They went on to allege that employees of the corporate debtor, namely Devender Bhardwaj and Vivek Sharma, canvassed support among homebuyers and CoC members for the rival resolution plan. Since these employees functioned under the supervision of the RP during CIRP, their conduct was attributed to the RP, who allegedly failed to take action.

Another allegation concerned circulation of two allegedly different compliance reports regarding the applicants' resolution plan. The applicants contended that while one report indicated compliance, another report circulated before the CoC portrayed the plan as non-compliant, thereby prejudicing creditor evaluation.

The RP submitted that VDR access was provided to all prospective resolution applicants simultaneously and additional information was continuously uploaded as and when available.

The RP further argued that Devender Bhardwaj and Vivek Sharma were employees of the corporate debtor and not representatives or associates of the RP. Upon learning of the alleged communications, he had immediately clarified that such conduct was “not in the right spirit.”

It was also submitted that both resolution plans were evaluated, as per the Evaluation Matrix, financial capability of the RAs, project completion timelines, and benefits to stakeholders, especially homebuyers. It was pointed out that the voting was conducted transparently and no objections were raised by the CoC.

It was further contended that the applicants, being unsuccessful PRAs, cannot challenge the commercial decision of the CoC.

The Tribunal observed that serious allegations such as collusion are serious allegations and must be supported by cogent evidence. The bench observed that merely because employees of the corporate debtor were working under the RP's supervision during CIRP could not automatically render every action of those employees attributable to the RP.

The applicants failed to establish any direct nexus showing that the RP authorised, directed, or permitted in the alleged canvassing activities.

On the allegation of information asymmetry, the bench noted that the applicants had been granted access to the VDR, undertaken site visits, and submitted both an original and revised resolution plan. The record did not establish that the applicants were denied a fair opportunity to formulate and submit its Resolution Plan.

The Tribunal also found no documentary material supporting the allegation that conflicting compliance reports materially influenced the CoC's decision.

The CoC had independently considered both plans, examined evaluation matrix scores, financial capability, implementation proposals, and benefits to stakeholders before deciding to vote. It was noted that the decision to put both Resolution Plans to vote was thus taken after consideration at the CoC level.

Accordingly, the NCLT refused to interfere with the CoC's commercial wisdom. The Tribunal refused to remove the RP and rejected the request for a fresh round of voting. Consequently, the application was dismissed without costs.

For Applicants: Advocates Gurcharan Singh & Amardeep Singh

For Respondents: Advocates Karan Gandhi, Sikhar Tiwari, Pratham Bansal, Riya Jain, Vidhika Kapoor