SRA Who Failed To Implement Resolution Plan Not Necessary Party To Liquidation Proceedings: NCLAT

The National Company Law Appellate Tribunal (NCLAT) has held that a successful resolution applicant who fails to implement an approved resolution plan is not a necessary party to a liquidation application.

The tribunal made the observation while dismissing two appeals filed by Roopya Tradebizz Ltd against orders directing the liquidation of Euphoria Technologies Pvt Ltd.

"In so far as submission of the appellant that he was necessary party to the liquidation application, we are of the view that SRA who failed to implement the plan is not the necessary party in the application which was filed for liquidation of CD", the tribunal held.

A bench of Chairperson Justice Ashok Bhushan and Technical Member Indevar Pandey upheld orders passed on January 8 and January 13, 2026. The first order directed the Monitoring Committee to file an application for liquidation after finding that the resolution plan had not been implemented. The second order allowed the liquidation application and appointed a liquidator.

Roopya Tradebizz Ltd, the successful resolution applicant (SRA), argued that it had initially paid ₹72 lakh and had also made an upfront payment of ₹99 lakh. According to the appellant, further payments could not be made because the assets contemplated under the resolution plan were not handed over and permission to sell those assets was not granted. The appellant further contended that it was a necessary party to the liquidation proceedings and should have been impleaded.

Opposing the appeals, the respondents submitted that the appellant had failed to implement the resolution plan within the stipulated timelines. They pointed out that the ₹99 lakh upfront payment was made through a third-party bank draft, which expired before the amount could be realised. They further argued that the appellant failed to make subsequent payments or take steps necessary for implementation of the plan.

After hearing the parties, the appellate tribunal held that the Adjudicating Authority had committed no error in directing liquidation proceedings. The bench emphasized that adherence to timelines is a fundamental feature of the corporate insolvency resolution process and that liquidation is the consequence when a successful resolution applicant fails to implement an approved plan within the prescribed period.

“Timeline in CIRP has its own importance and proceeding has to be completed within a reasonable time and after SRA has failed to implement the plan the liquidation in the consequence and Adjudicating Authority has rightly directed for liquidation.” the tribunal said.

Rejecting the appellant's contention that it was a necessary party to the liquidation application, the bench observed, “In so far as submission of the appellant that he was necessary party to the liquidation application, we are of the view that SRA who failed to implement the plan is not the necessary party in the application which was filed for liquidation of CD.”

The tribunal also dealt with the appellant's apprehension that the liquidator might auction the corporate debtor's assets at an undervalued price. It observed that any interested party could avail remedies available under law against such an auction. Finding no ground to interfere with the NCLT's orders, the NCLAT dismissed both appeals.