NCLAT Upholds Finality of Resolution Plan in Sumeet Industries Ltd. v. DGVCL
The Principal Bench of the National Company Law Appellate Tribunal (NCLAT), New Delhi, in Sumeet Industries Limited v. Dakshin Gujarat Vij Company Limited & Ors. (25.05.2026), dismissed an appeal filed under Section 61 of the Insolvency and Bankruptcy Code, 2016 (IBC), seeking restoration of a security deposit and refund of amounts allegedly adjusted towards pre-CIRP electricity dues.
The dispute arose after Dakshin Gujarat Vij Company Limited (DGVCL), the electricity supplier to the Corporate Debtor (CD), issued an energy bill for November 2022. Subsequently, Corporate Insolvency Resolution Process (CIRP) commenced in December 2022 upon initiation by IDBI Bank. During CIRP, the Resolution Professional requested uninterrupted electricity supply to maintain the CD as a going concern.
DGVCL thereafter issued a December 2022 electricity bill stating that the “advance payment/security deposit appropriated.” Although the CD paid the CIRP-period electricity dues, it alleged that DGVCL unlawfully adjusted these payments and the security deposit towards pre-CIRP dues, thereby violating the moratorium under Section 14 of the IBC. The Appellant further challenged the adjustment after noticing entries relating to interest on security deposits and TDS in subsequent bills. Applications were consequently filed before the NCLT and later before the High Court to prevent disconnection of electricity supply.
The NCLAT examined whether DGVCL had illegally appropriated the security deposit amounting to approximately INR 8.30 crore and wrongly adjusted CIRP-period payments of around INR 3.78 crore against pre-CIRP liabilities.
While dismissing the appeal, the Tribunal made important observations regarding the functioning of public utility entities and the sanctity of approved resolution plans. It observed that administrative decisions and accounting implementation in public utilities may not occur simultaneously, but once a competent authority takes a decision, it becomes binding and operative.
The Tribunal also distinguished the statutory role of the Committee of Creditors (CoC) from that of the Monitoring Committee. It held that a decision requiring concurrence or knowledge of the CoC could not subsequently be ratified by the Monitoring Committee, which lacks equivalent statutory authority under the IBC framework.
Most significantly, the NCLAT emphasized that once a Resolution Plan has attained finality and implementation has commenced, directing restoration of substantial amounts would disturb settled commercial rights and alter the financial assumptions underlying the approved plan. Such interference, according to the Tribunal, would amount to impermissible modification of the Resolution Plan after approval by the Adjudicating Authority.
Conclusion
The decision reinforces the principle of finality of approved resolution plans under the IBC. The NCLAT underscored that post-approval financial adjustments affecting commercial arrangements cannot ordinarily be reopened, particularly where implementation has already commenced. The ruling also highlights judicial reluctance to interfere with settled claims once the resolution framework has crystallized.
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