# In the matter of Bank of India Vs. Royal Splendour Developers Pvt. Ltd. CA(AT)(Ins) No. 281 of 2020

> NCLAT judgment dated 2020-02-17. Citation: TCN-2020-NCLAT-00402. The case involves an appeal against the approval of a resolution plan for Royal Splendour…

- **Court:** NCLAT
- **Order date:** 17 Feb 2020
- **Citation:** TCN-2020-NCLAT-00402
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/bank-of-india-vs-royal-splendour-developers-pvt-ltd-ca-16d5e527

## Summary

### Background

The case involves an appeal against the approval of a resolution plan for Royal Splendour Developers Pvt. Ltd. The Committee of Creditors (COC) approved the resolution plan, which was also approved by the Adjudicating Authority (National Company Law Tribunal, Division Bench, Chennai). The Appellant Bank, a minority shareholder with 24.97% voting share, voted against the plan and sought liquidation instead. The Appellant's objection is that the resolution plan does not address the handling of securities held by the bank if the Successful Resolution Applicant (SRA) fails to complete the project.

## Facts

The Committee of Creditors (COC) approved a resolution plan for Royal Splendour Developers Pvt. Ltd., which was also approved by the Adjudicating Authority (National Company Law Tribunal, Division Bench, Chennai). The Appellant Bank, holding a minority 24.97% voting share, opposed the resolution plan, preferring liquidation. The Appellant's primary concern was the absence of provisions in the resolution plan addressing the treatment of securities held by the bank should the Successful Resolution Applicant (SRA) fail to complete the project. The Appellant's counsel could not demonstrate that such a proposal was made during the COC meeting. The court considered the limited scope of its jurisdiction to interfere with the commercial decisions of the COC, referencing the

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## Issues and analysis

### Issue 1: Whether the Appellate Tribunal has jurisdiction to interfere with the commercial decision of the …

**Ratio:** The Tribunal has limited jurisdiction to interfere in the commercial decision taken by

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**Reasoning:** The court relied on the Supreme Court's judgment in 'Committee of Creditors of Essar

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**Interpretation:** The court interpreted the Supreme Court's judgment as emphasizing the

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**Application:** The court applied this principle to the present case, finding that the

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## Parties

- **Judges:** A.I.S. C…; A.B. S…; +1 more
- **Appellants:** Bank of…
- **Respondents:** Royal Splendour…

## Timeline

- **2020-02-17 — Hearing…**: The court heard the…

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