The Supreme Court on Wednesday reserved its judgment on whether the National Company Law Tribunal can permit withdrawal of an application seeking approval of a resolution plan after the Committee of Creditors has approved the plan and submitted it to the Adjudicating Authority. According to reports from LiveLaw, a Bench of Justices J.B. Pardiwala and K. Vinod Chandran was hearing Indian Bank's challenge against the National Company Law Appellate Tribunal's April 20, 2026, order concerning TD Toll Road Pvt Ltd, which had set aside the NCLT's decision allowing withdrawal of the resolution plan approval application. The case involves Indian Bank's challenge to the NCLAT's ruling in the insolvency proceedings of TD Toll Road Private Limited.
The appellate tribunal had overturned the NCLT's decision permitting withdrawal of the application seeking approval of the resolution plan. As reported by LiveLaw, the NCLAT held that once a resolution plan is approved by the CoC and submitted to the adjudicating authority, the CoC cannot withdraw it. The case involves Indian Bank's challenge to the NCLAT's ruling in the insolvency proceedings of TD Toll Road Private Limited.
Appearing for Indian Bank, Senior Advocate Gopal Sankaranarayanan argued that the CoC should retain the ability to reconsider its decision when circumstances materially change. According to LiveLaw, he explained that the plan was approved during the COVID 19 period, when toll collections were depressed, but that the corporate debtor's financial position subsequently improved substantially. Sankaranarayanan submitted that the CoC held a series of meetings from its 14th to 22nd meetings, during which it observed a substantial improvement in the corporate debtor's solvency position. He also argued that the NCLT should be allowed to consider the changed circumstances while deciding the pending approval application.
Senior Advocate Nidhesh Gupta, representing the successful resolution applicant, opposed the withdrawal. As reported by LiveLaw, he relied on the judgment in Ebix Singapore and other Supreme Court observations on the binding nature of a CoC-approved resolution plan. Gupta argued that the resolution plan could not be treated merely as a contract governed by the Contract Act between its acceptance by the CoC and approval by the Adjudicating Authority, as it already has binding effect under the IBC framework during this period. He submitted: "Relying on the Court's observation in Ebix Singapore, Gupta said, 'The language of Section 31 cannot be construed to mean that a resolution plan is indeterminate or open to withdrawal or modification until it is approved.'" Gupta argued that the principle must apply equally to the CoC and the successful resolution applicant, contending that neither should be allowed to withdraw merely because the corporate debtor's financial position has subsequently improved or deteriorated.
The Bench questioned the consequences of abandoning the existing plan, particularly how creditors would recover their dues if a fresh process were initiated. According to LiveLaw, Justice Pardiwala questioned how the creditors would recover their dues if the Court accepted the argument and the existing resolution plan was not pursued. The court also examined IBBI regulations which permit CoC meetings to continue until a resolution plan is approved under Section 31 or liquidation is ordered under Section 33. The court took note of the fact that the successful resolution applicant had furnished a performance bank guarantee of about ₹8.62 crore and had acted on the basis of the CoC's approval. The judgment was reserved after hearing the parties, with the court yet to announce its final decision.
