Case Law Details
Deccan Value Investors L.P. & Anr Vs Dinkar Venkatasubramanian & Anr (Supreme Court of India)
The Supreme Court’s judgment in the case of Deccan Value Investors L.P. & Anr vs. Dinkar Venkatasubramanian & Anr addresses crucial aspects of insolvency proceedings, particularly concerning the withdrawal or modification of resolution plans post-approval by the Committee of Creditors (CoC).
The crux of the matter lies in the Supreme Court’s assertion that once a resolution plan receives approval from the CoC, it becomes legally binding and irrevocable. This stance, reinforced by the precedent set in the Ebix Singapore Private Limited case, underscores the need for certainty and finality in the Corporate Insolvency Resolution Process (CIRP).
The judgment highlights several reasons supporting this stance, including the adverse effects of delays and the complexities that could arise from allowing modifications post-CoC approval. Moreover, it emphasizes that resolution plans, once approved, are not merely contractual agreements but statutory obligations under the Insolvency and Bankruptcy Code (IBC).
The Court also addresses arguments related to the effectiveness of resolution plans, emphasizing the limited scope of the adjudicating authority’s scrutiny under Section 31(1) of the IBC. It dismisses claims of fraud or misinformation on the part of the resolution professional, emphasizing the responsibility of resolution applicants to conduct thorough due diligence.
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