K. Sunil Kumar Vs Union of India (Kerala High Court)
Two writ petitions were filed before the Kerala High Court challenging an order dated 21.08.2025 passed by the National Company Law Tribunal (NCLT), Kochi Bench, in IA (IBC)(Plan)/04/KOB/2025 in CP(IBC)/20/KOB/2023. The impugned order rejected a resolution plan submitted by the Resolution Professional during the corporate insolvency resolution process of the concerned company and directed that the Corporate Debtor, the applicant in the Section 7 petition, the Resolution Professional, and the secured financial creditor be heard further to arrive at a legally sound and just conclusion.
One writ petition was filed by a member of the Committee of Creditors holding 80.11% voting share, while the other was filed by a person who had extended a personal guarantee in respect of loans availed by the corporate debtor. The common contention raised by both petitioners was that the NCLT’s order rejecting the resolution plan was not an appealable order under the Insolvency and Bankruptcy Code, 2016 (IBC), and therefore, the writ petitions before the High Court were the only available remedy.
The principal issue considered by the Court was whether an order of the NCLT rejecting a resolution plan is appealable under the IBC framework. To address this, the Court examined the relevant statutory provisions. Section 31 of the IBC empowers the Adjudicating Authority either to approve a resolution plan, if it satisfies the requirements under Section 30, or to reject the plan by an order if it does not conform to those requirements. Thus, the statute expressly contemplates both approval and rejection of a resolution plan through formal orders.
