Vedanta Limited Vs Bhuvan Madan (NCLT Allahabad)
Summary: The National Company Law Tribunal, Allahabad Bench, in Vedanta Limited Vs Bhuvan Madan, Resolution Professional of Jaiprakash Associates Limited, dismissed Vedanta’s application challenging the Committee of Creditors’ (CoC) decision to approve the resolution plan submitted by Adani Enterprises Limited for Jaiprakash Associates Limited (JAL). The application, filed on 3 January 2026 under Section 60(5) of the Insolvency and Bankruptcy Code, 2016, read with Rule 11 of the NCLT Rules, 2016, questioned the legality, fairness and commercial rationale of selecting Adani’s proposal despite Vedanta having offered the highest net present value (NPV) during the challenge process. The corporate debtor had entered the Corporate Insolvency Resolution Process (CIRP) on 3 June 2024. Following invitations for expressions of interest and circulation of the Request for Resolution Plan (RFRP), Vedanta participated as a prospective resolution applicant and furnished a bid bond of Rs. 100 crore. The dispute principally concerned whether the highest financial bidder was entitled to selection, whether a subsequent enhancement of its financial proposal should have been considered, and whether the CoC had exercised its commercial wisdom consistently with the objectives of the IBC.
The Tribunal recorded that the CoC had initiated a competitive challenge process to improve financial proposals and maximise value for stakeholders. The process was conducted on 5 September 2025 and extended through five rounds. Vedanta increased its offer to an NPV of Rs. 12,505.85 crore by the third round, and that amount remained the highest under the identified financial criteria through the remaining rounds. Vedanta subsequently submitted its final signed resolution plan on 14 October 2025. On 8 November 2025, it submitted an addendum increasing the proposed upfront cash payment from Rs. 3,770 crore to Rs. 6,563 crore and equity infusion from Rs. 400 crore to Rs. 800 crore, without altering the overall NPV. Vedanta contended that its proposal exceeded the competing bid by approximately Rs. 500 crore in NPV and Rs. 3,400 crore in gross value. It argued that rejection of its enhanced proposal defeated value maximisation, undermined the integrity of competitive bidding, and required reconsideration by the CoC. However, the CoC declined to consider the addendum, and Adani’s resolution plan was approved with 93.81% of the voting share.
The Resolution Professional and the CoC opposed Vedanta’s challenge, maintaining that neither participation in the CIRP nor submission of the highest NPV bid conferred a vested right to approval. They relied on the RFRP and Process Note, which expressly reserved the CoC’s discretion to evaluate feasibility, viability, payment structure and other commercial factors rather than select a bidder solely on the highest financial offer. The Process Note also prohibited upward or downward revision of financial proposals after closure of the challenge process. According to the respondents, Vedanta’s addendum was an unsolicited modification submitted after the final plans had been received and the CoC had decided to proceed towards voting. Accepting it would have required reopening the process and offering equivalent opportunities to other resolution applicants. The CoC therefore considered the addendum at its 24th meeting on 14 November 2025 and declined to entertain it. The respondents further argued that the approved plan was selected through an evaluation matrix incorporating both quantitative and qualitative criteria, including upfront recovery, NPV, equity infusion, feasibility, viability and implementation capability.
The Tribunal framed four principal questions concerning Vedanta’s locus standi, the legality of rejecting the addendum, the validity of the evaluation matrix, and the scope of judicial review over the CoC’s commercial decision. On the preliminary issue, the Tribunal rejected the respondents’ contention that an unsuccessful resolution applicant was entirely barred from approaching the adjudicating authority. Although a prospective resolution applicant has no vested or fundamental right to obtain approval of its plan, the Tribunal held that Vedanta possessed locus standi to maintain an application alleging violations of the statutory framework or material irregularities in the resolution process. The adjudicating authority’s jurisdiction nevertheless remained limited to examining compliance with the IBC, including resolution plans” target=”_blank” rel=”noopener”>Section 30(2), Section 31(1) and applicable procedural requirements. It could not substitute its own commercial assessment for that of the CoC merely because another plan appeared financially preferable. Accordingly, the first issue was decided in Vedanta’s favour on maintainability, without recognising any enforceable entitlement to selection as the successful resolution applicant.
On the second issue, the Tribunal upheld the CoC’s decision not to consider Vedanta’s addendum. It found that the challenge process had concluded, final signed resolution plans had been submitted, and the process documents prohibited subsequent changes to the financial proposals. Vedanta had participated with knowledge of these conditions and could not insist upon reopening the competitive process after the prescribed stage had passed. The Tribunal accepted that permitting a unilateral post-process enhancement would compromise the equal treatment of competing applicants unless all participants were afforded a corresponding opportunity, thereby disrupting the established procedure and delaying finality. It therefore held that the CoC’s refusal to accept the addendum was consistent with the RFRP, the Process Note and the governing insolvency regulations. The Tribunal emphasised that maximisation of value under the IBC must be pursued through a fair, predictable and time-bound resolution process rather than by indefinitely entertaining revised financial offers.
On the third issue, the Tribunal examined the evaluation matrix adopted for comparing competing resolution plans. The CoC had appointed BDO India LLP to assess the plans against quantitative parameters carrying 80 marks and qualitative parameters carrying 20 marks. The quantitative criteria included upfront cash recovery, NPV of payments to financial and other creditors, and equity or quasi-equity infusion, while qualitative criteria addressed the viability of financial projections, turnaround capability and financial discipline. The evaluation table recorded an overall score of 89.76 for Adani and 75.60 for Vedanta, with Adani obtaining substantially higher marks for upfront cash recovery and qualitative parameters despite Vedanta scoring higher on the NPV of payments to financial creditors. The Tribunal held that the matrix reflected permissible commercial considerations and satisfied the IBC’s objectives. It rejected the proposition that the highest NPV or gross offer must automatically prevail, recognising that certainty, timing of payment, implementation feasibility and sustainable revival were relevant to the creditors’ commercial assessment.
Finally, the Tribunal concluded that the resolution process was fair, transparent and consistent with the IBC and CIRP Regulations. All prospective resolution applicants had received an equitable opportunity to participate, submit revised proposals and compete under the prescribed criteria. The Tribunal considered the authorities cited by the parties on commercial wisdom, value maximisation, modification of resolution plans and limited judicial intervention, distinguishing decisions involving discriminatory treatment or failure to consider proposals submitted within the applicable timeline. It found no breach of Section 30(2), material procedural irregularity or other statutory violation justifying interference with the CoC’s approval of Adani’s resolution plan. Accordingly, the fourth issue was decided against Vedanta, and IA No. 01/2026 was dismissed by the order pronounced on 17 March 2026. The ruling affirms that an unsuccessful resolution applicant may raise a legally maintainable challenge to procedural or statutory non-compliance, but cannot secure reversal of a commercially approved resolution plan merely by demonstrating a higher financial bid.
Cases Discussed
- ArcelorMittal India Private Limited v. Satish Kumar Gupta — (2019) 2 SCC 1 (SC).
- Swiss Ribbons Pvt. Ltd. v. Union of India — W.P.(C) No. 99 of 2018 (SC).
- Authum Investment and Infrastructure Ltd. v. Rajneesh Sharma — Company Appeal (AT) (Insolvency) No. 1072 of 2023 (NCLAT).
- K. Sashidhar v. Indian Overseas Bank — (2019) 12 SCC 150 (SC).
- Committee of Creditors of Essar Steel India Ltd. v. Satish Kumar Gupta — (2020) 8 SCC 531 (SC).
- Kalpraj Dharamshi v. Kotak Investment Advisors Ltd. — (2021) 10 SCC 401 (SC).
- Vallal RCK v. Siva Industries & Holdings Ltd. — (2022) 9 SCC 803 (SC).
- Jaypee Kensington Boulevard Apartments Welfare Association v. NBCC (India) Ltd. — (2022) 1 SCC 401 (SC).
- Ebix Singapore (P) Ltd. vs. Educomp Solutions Ltd. (Supreme Court) (2022) 2 SCC 401
- Elegna Co-Op. Housing and Commercial Society Ltd. v. Edelweiss Asset Reconstruction Company Ltd. & Anr. (Supreme Court), (Civil Appeal No. 10261 of 2025)
