# Approval of Resolution Plan - Varutha Developers Private Limited

> NCLT judgment dated 2025-01-07. Citation: TCN-2025-NCLT-00661. The case involves an application by Ganga Construction (Consortium) under Section 60(5) of the…

- **Court:** NCLT
- **Order date:** 7 Jan 2025
- **Citation:** TCN-2025-NCLT-00661
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/approval-of-resolution-plan-varutha-developers-private-limited-fe124102

## Summary

### Background

The case involves an application by Ganga Construction (Consortium) under Section 60(5) of the Insolvency and Bankruptcy Code, 2016, against Anil Kumar Mittal, the Resolution Professional (RP) of Varutha Developers Pvt. Ltd. (Corporate Debtor), and others. The application seeks to challenge the Corporate Insolvency Resolution Process (CIRP) of Varutha Developers, alleging collusion and fraudulent activities by the RP, the Committee of Creditors (CoC), and Manglam Multiplex Pvt. Ltd., the successful resolution applicant (SRA). The applicant contends that the CIRP was manipulated to favor Manglam Multiplex, a proxy of M3M India, by suppressing material information and sidelining genuine prospective resolution applicants (PRAs). The CIRP was initiated by Srei Equipment

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## Facts

Varutha Developers Private Limited faced Corporate Insolvency Resolution Process (CIRP) due to a default of Rs. 439,10,51,260/- to SREI Equipment Finance Limited, the financial creditor. The CIRP was initiated following a loan agreement executed on July 26, 2019, where SREI sanctioned a loan facility of Rs. 300,00,00,000/- to Varutha. Ganga Construction (Consortium), a prospective resolution applicant (PRA), submitted a resolution plan with a financial proposal of Rs. 200 Crore, later enhanced to Rs. 250 Crore. Ganga Construction alleged that the Resolution Professional (RP) failed to disclose vital information about the corporate debtor's assets, particularly a land parcel, and manipulated the CIRP to favor Manglam Multiplex Pvt. Ltd., a proxy of M3M India. The

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## Issues and analysis

### Issue 1: Whether the application filed by Ganga Construction (Consortium) under Section 60(5) of the …

**Ratio:** An unsuccessful resolution applicant lacks the locus standi to challenge the resolution

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**Reasoning:** The court relied on the judgment rendered by the Hon'ble NCLAT Chennai in M. K.

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**Interpretation:** The interpretation of the law is that once a resolution plan is approved by the

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**Application:** In this case, Ganga Construction was an unsuccessful resolution applicant, and

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## Parties

- **Judges:** D. Ar…; BIDISHA BA…
- **Appellants:** Ganga Construction…
- **Respondents:** Varutha Developers…; Ernst & You…

## Timeline

- **2019-07-26 — Loan Agreement…**: Loan Agreement executed between SREI Equipment Finance Limited and Varutha Developers…
- **2023-12-20 — Ex-parte Admiss…**: Adjudicating Authority passed an ex-parte admission order for Corporate Insolvency…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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