# M/S NIRMAL UJJWAL CREDIT CO-OPERATIVE SOCIETY LTD. vs. RAVI SETHIA & ORS.

> SC judgment dated 2026-04-09. Citation: TCN-2026-SC-00061. M/S Nirmal Ujjwal Credit Co-operative Society Ltd. (Appellant), a Multi-State Co-operative Society…

- **Court:** SC
- **Order date:** 9 Apr 2026
- **Citation:** TCN-2026-SC-00061
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/supreme-court-of-india/ms-nirmal-ujjwal-credit-co-operative-society-ltd-vs-ravi-sethia-ors-kitkb

## Summary

### Background

M/S Nirmal Ujjwal Credit Co-operative Society Ltd. (Appellant), a Multi-State Co-operative Society (MSCS), submitted a resolution plan for Morarji Textiles Ltd. (Corporate Debtor) during its Corporate Insolvency Resolution Process (CIRP). The Corporate Debtor is involved in man-made fibre/viscose textile manufacturing, while the Appellant primarily operates in financial services with an incidental agro-product processing unit. The Appellant's resolution plan was rejected by the Resolution Professional (RP), the National Company Law Tribunal (NCLT), and the National Company Law Appellate Tribunal (NCLAT) on the grounds that the Appellant was ineligible under Section 64(d) of the Multi-State Cooperative Societies Act, 2002, and its own bye-laws, as it was not considered

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## Facts

The appellant is a co-operative society registered under the Multi-State Cooperative Societies Act, 2002, operating a textile unit named "Nirmal Textile" in Nagpur with a GST registration dated 23.04.2021 and a factory licence dated 28.10.2022.

On 03.08.2023, Section 64(d) of the 2002 Act was amended to allow Multi-State Co-operative Societies (MSCS) to invest in subsidiary institutions or any other institution "in the same line of business as the MSCS".

The appellant issued a notice on 01.09.2023 for an Annual General Meeting (AGM) to amend its bye-laws, and an AGM was conducted on 24.09.2023, proposing amendments to Clause 52 to include the verbatim provision of amended Section 64(d).

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## Issues and analysis

### Issue 1: Whether the appellant, a Multi-State Co-operative Society, is eligible to submit a resolution plan …

**Ratio:** An MSCS can invest its funds in a subsidiary institution or any other institution

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**Reasoning:** Section 30(2)(e) of the IBC mandates that a resolution plan must not contravene any law

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**Interpretation:** The eligibility of an MSCS to submit a resolution plan is contingent upon its

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**Application:** The appellant's resolution plan was rejected by the RP, NCLT, and NCLAT on the

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## Parties

- **Judges:** J.B. PARD…; K.V. VISWA…
- **Appellants:** M/S NIRMAL UJJWAL…
- **Respondents:** Morarji Textiles…; RAVI SETHIA…
- **Other parties:** Committee of…; Ravi Se…
- **Advocates:** Amit…; Mukul Ro…; +4 more

## Timeline

- **2021-04-23 — GST Regist…**: Nirmal Textile, a unit of the appellant,…
- **2022-10-28 — Factory L…**: Nirmal Textile, a unit of the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 11 — Persons not entitled to make application](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-11)

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