# In the matter of Avantha Holdings Limited & Anr. Vs. Mr. Abhilash Lal & Ors. Company Appeal (AT) (Insolvency) No. 304 of 2022

> NCLAT judgment dated 2022-07-04. Citation: TCN-2022-NCLAT-00397. This appeal was filed against an order dated 08.03.2022 by the National Company Law Tribunal,…

- **Court:** NCLAT
- **Order date:** 4 Jul 2022
- **Citation:** TCN-2022-NCLAT-00397
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/avantha-holdings-limited-anr-vs-mr-abhilash-lal-ors-company-appeal-68471e19

## Summary

### Background

This appeal was filed against an order dated 08.03.2022 by the National Company Law Tribunal, Kolkata Bench, which rejected IA (IB) No.537/KB/2021. The appellant sought disqualification of the Successful Resolution Applicant under Section 29A of the Insolvency and Bankruptcy Code, 2016 (IBC), and aimed to set aside the Committee of Creditors' (CoC) decision to reject the appellant's proposal. The appellant, Avantha Holdings Limited, is the promoter and shareholder of Avanta Power and Infrastructure Limited, which holds 17.9% shares of the Corporate Debtor, Jhabua Power Limited. The CIRP was initiated on 27.03.2019, following an application by FLSmidth Private Limited under Section 9 of the Code. The appellant submitted a One Time Settlement (OTS) offer on 03.06.2019,

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## Facts

Avantha Holdings Limited, the appellant, is a promoter and shareholder of Avanta Power and Infrastructure Limited, which in turn holds 17.9% shares of the Corporate Debtor, Jhabua Power Limited. FLSmidth Private Limited filed an application under Section 9 of the IBC, leading to the initiation of Corporate Insolvency Resolution Process (CIRP) for Jhabua Power Limited on 27.03.2019. Mr. Abhilash Lal was appointed as the Resolution Professional (RP). Avantha Holdings submitted a One Time Settlement (OTS) offer on 03.06.2019, which was deemed commercially unviable by the Committee of Creditors (CoC). The RP invited Expression of Interest (EOI) from prospective resolution applicants, with a submission deadline of 31.12.2019. NTPC submitted a resolution plan on 30.12.2019.

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## Issues and analysis

### Issue 1: Whether NTPC was eligible to submit a resolution plan under Section 29A of the Insolvency and …

**Ratio:** Section 29A(c) of the IBC disqualifies a person from submitting a resolution plan if, at

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**Reasoning:** The court reasoned that the relevant date for determining NPA classification is the date

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**Interpretation:** The interpretation of Section 29A(c) hinges on the meaning of 'date of such

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**Application:** In this case, Canara Bank declared RGPPL and KLL as NPA on 21.05.2018, although

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## Parties

- **Judges:** Ashok Bh…; Shreesha…; +2 more
- **Appellants:** Avantha Holdings…
- **Respondents:** Jhabua Power…; Abhilas…
- **Advocates:** Abhishek Manu…; K. Da…; +10 more

## Timeline

- **2019-03-27 — CIRP Init…**: Corporate Insolvency Resolution Process (CIRP) of Jhabua Power Limited initiated…
- **2019-06-03 — OTS Offe…**: Avantha Holdings Limited submitted a One Time Settlement (OTS) offer to the Resolution…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 12A — (1) Subject to sub](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-12a)

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