# In the matter of ARCL Organics Ltd. vs. Stressed Asset Stabilization Fund

> HC judgment dated 2025-06-30. Citation: TCN-2025-HC-00062. The applicant, ARCL Organics Ltd., filed an application for the execution of an order sanctioning a…

- **Court:** HC
- **Order date:** 30 Jun 2025
- **Citation:** TCN-2025-HC-00062
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/bombay-high-court-panaji/arcl-organics-ltd-vs-stressed-asset-stabilization-fund-b965f094

## Summary

### Background

The applicant, ARCL Organics Ltd., filed an application for the execution of an order sanctioning a scheme of arrangement/compromise dated January 14, 2009, in CA No. 414 of 2008, arising out of CP No. 306 of 2008 under Section 391(2) of the Companies Act, 1956. The applicant seeks a direction upon the respondent, Stressed Asset Stabilization Fund, to issue a 'No Objection Certificate' for the release of all charges on the applicant's assets and properties, arguing that such charges have been extinguished.

## Facts

ARCL Organics Ltd. is the successor-in-interest of Allied Resin, which merged with ARCL Organics Ltd. on September 15, 2010.

A scheme of compromise was sanctioned between Allied Resin and its secured creditors on January 14, 2009.

ARCL Organics Ltd. claims to have complied with the terms of the scheme and paid the entire settlement amount with interest.

The respondent, Stressed Asset Stabilization Fund, issued a notice under Section 13(2) of the SARFAESI Act, alleging default by Allied Resin.

The applicant argues that the sanctioned scheme debars the respondent from initiating any new proceedings for recovery of dues.

The respondent contends that Allied Resin defaulted in making payments under the sanctioned scheme, commencing in April 2010 and continuing until July 2011.

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## Issues and analysis

### Issue 1: Whether the respondent can unilaterally resile from the scheme of compromise sanctioned by the …

**Ratio:** A scheme of compromise sanctioned by the court has a statutory force and is binding on

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**Reasoning:** The court relied on the judgments in S. K. Gupta & Anr. v. K. P. Jain & Anr. and

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**Interpretation:** Section 391 envisages a compromise or arrangement being proposed for

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**Application:** The court held that the respondent could not unilaterally resile from the

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## Parties

- **Judges:** RAJA BASU…
- **Appellants:** ARCL Organi…
- **Respondents:** Allied Resin and…; Stressed Asset…
- **Other parties:** Kalabu…
- **Advocates:** Ratnanko B…; Kanishk Ke…; +8 more

## Timeline

- **2009-01-14 — Scheme Sanc…**: Scheme of compromise sanctioned between…
- **2009-03-02 — Scheme Eff…**: Scheme became e…

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