(2025) ibclaw.

in 344 NCLAT

IN THE NATIONAL COMPANY LAW APPELLATE TRIBUNAL

Principal Bench, New Delhi

Dr. Arabinda Kumar Rath

v.
Siba Kumar Mohapatra

Company Appeal (AT) (Insolvency) No. 1482 of 2023

Decided on 07-May-25

Mr. Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra (Technical Member)

Add. Info:

Impugned Order: Hemalata Hospitals Ltd. Vs. Sh. Siba Kumar Mohapatra RP,
(2023) ibclaw.in 489 NCLT

Corporate Debtor: Medirad Tech India Ltd.

For Appellant(s): Mr. Tishampati Sen, Mr. Shubhanshu Gupta, Advocates.

For Respondent(s): Mr. Gaurav Mitra, Mr. Shouryendu Ray, Ms. Vatsala Poddar,
Ms. Aarushi Mishra, Ms. Neelu Mohan, Advocates.

Brief about the decision:

When there were only two Financial Creditors in the CoC and they had
settled their doubts and ambiguities about each other’s claim and
there was no inter se dispute between them on the quantum of claim,
they had actually opted and chosen to put a quietus to the matter. That
being the ground situation, the suspended management of the
Corporate Debtor has no locus to raise unfounded allegations about
the quantum of claims claimed by the Financial Creditors and admitted
by the RP.(p11)
The obligation of the RP under CIRP Regulations and IBC is limited
only to the appointment of the registered valuers, while the valuation
is to be approved by the CoC under the mandate of commercial

Print For: Navneet & Co. Page 1 of 17 Printed: 10.09.2025

 (2025) ibclaw.in 344 NCLAT
IBC Laws® Dr. Arabinda Kumar Rath v. Siba Kumar Mohapatra

wisdom. Thus, the RP cannot be faulted on this count as it had

discharged its statutory responsibility having appointed the valuers
and submitted their report to the CoC for its consideration.(p19)
The approval of the valuation of Corporate Debtor is an exercise
which falls under the purview of commercial wisdom undertaken
by the CoC. The scope of interference by the Adjudicating
Authority in the commercial wisdom exercised by the CoC is
minimal.(p20)
Since the Appellant (Suspended Board of Director of the Corporate
Debtor) had no right to vote in the meeting of the CoC, they cannot be
said to have suffered from any prejudice for not being provided with
the valuation report. Whether the detailed valuation report was placed
before the Appellant or not is immaterial and irrelevant since it is only
the members of the CoC who were required to exercise the commercial
wisdom on the valuation reports placed before them and not the
Appellant who did not have the right to exercise their vote.(p20)
The RP is not required to share the valuation with any entity
except the members of the CoC that too after obtaining
confidentiality undertaking. There is no provision under IBC or
the CIRP Regulations framed thereunder which necessitates the
valuation report of the Corporate Debtor to be shared with the
suspended management of the Corporate Debtor.(p21)
The confidential nature of the fair value and liquidation value of the
Corporate Debtor is highlighted in Regulation 35(2) of the CIRP
Regulations and the RP is not obligated to share these reports with
anyone but for the members of the CoC. The RP had not violated the
statutory construct of the IBC in not acceding to the request of the
Appellant to provide them with the valuation report.(p21)
The RPs jurisdiction is restricted only to presenting any
settlement offer before the CoC and it strictly lies on the
commercial wisdom of the CoC to accept or reject the aforesaid
offer. If the Financial Creditors did not respond to the offer and CoC
proceeded ahead to approve the resolution plan of the SRA, it was an
act of exercise of commercial wisdom of the CoC. The Financial
Creditors were not obligated to respond to the settlement offer. It is
settled law that the collective business decision of the CoC cannot be
interfered with either by the RP or the Adjudicating Authority.(p22)

Print For: Navneet & Co. Page 2 of 17 Printed: 10.09.2025

 (2025) ibclaw.in 344 NCLAT
IBC Laws® Dr. Arabinda Kumar Rath v. Siba Kumar Mohapatra

Law is now well settled that the jurisdiction of the Adjudicating and
Appellate Authorities to interfere with approval of the resolution plan
is limited. The scope of judicial review is confined to the provisions
contained in Section 30(2) of the IBC for the Adjudicating Authority
and Section 61(3) for the Appellate Authority. There is only limited
review which can be exercised by the Adjudicating Authority or the
Appellate Authority.(p24)
As long as the statutory provisions of the IBC and the CIRP
Regulations framed thereunder are complied with, it is the
commercial wisdom of the requisite majority of the CoC which is
to negotiate and accept a resolution plan. Once all the mandatory
requirements have been duly complied with and taken care of, the
Adjudicating Authority cannot deal with the merits of Resolution Plan
unless it is found it to be contrary to the express provisions of law and
against the public interest. There is neither any material irregularity
nor contravention of any provision of law by the CoC which has been
justifiably substantiated by the Appellant. In the present case when no
valid grounds have been made out to challenge the approval of the
resolution plan, the legislative fiat of the IBC that the Adjudicating
Authority cannot trespass upon the business decision of the CoC holds
ground.(p26)
The Appeal is dismissed with no costs.(p27)

Judgment/Order:

JUDGMENT
(Hybrid Mode)

Per: Barun Mitra, Member (Technical)

The present appeal filed under Section 61 of Insolvency and Bankruptcy Code
2016 (‘IBC’ in short) by the Appellant arises out of the Order dated 09.08.2023
(hereinafter referred to as ‘Impugned Order’) passed by the Adjudicating
Authority (National Company Law Tribunal, New Delhi Bench-II) in I.A. No.
5617/ND/2022 in C.P. (IB) No. 1243(ND)/2018. By the impugned order, the
Adjudicating Authority has approved the Resolution Plan of the Successful
Resolution Applicant (“SRA” in short) and dismissed the objections raised by

Print For: Navneet & Co. Page 3 of 17 Printed: 10.09.2025

 (2025) ibclaw.in 344 NCLAT
IBC Laws® Dr. Arabinda Kumar Rath v. Siba Kumar Mohapatra

erstwhile management of the Corporate Debtor. Aggrieved by the impugned

order, the present appeal has been preferred by the Appellant who is a member
of the suspended Board of Director of the Corporate Debtor.

2. Coming to the brief factual background of the present case at hand, M/s
Medirad Tech India Ltd.-Corporate Debtor was admitted into the rigours of
Corporate Insolvency Resolution Process (“CIRP” in short) following the
admission of Section 7 application filed by M/s India SME Assets
Reconstruction Company Ltd. (ISARC) on 08.12.2021. Following the initiation
of CIRP, the Interim Resolution Professional who was later confirmed as the
Resolution Professional (“RP” in short) constituted the Committee of Creditors
(“CoC” in short) comprising of two members, namely, Technology
Development Board (TDB) and ISARC and invited plans for resolution of the
Corporate Debtor. The RP had submitted before the CoC two resolution plans
received from Prospective Resolution Applicants (“PRAs” in short) as may be
seen from the minutes of the 5th CoC meeting held on 05.05.2022. After due
scrutiny of the plans on the basis of the evaluation matrix, Asian Institute of
Oncology Pvt. Ltd. (AIOPL) emerged as SRA in the 9th CoC meeting. The RP
submitted IA No. 5617 of 2022 before the Adjudicating Authority seeking
approval of the resolution plan submitted by the SRA. The Adjudicating
Authority approved the resolution plan dismissing the objections raised by the
present Appellant to the said resolution plan. Aggrieved by the impugned
order, the present appeal has been preferred by the Appellant.

3. Making his submissions, Shri Tishampati Sen, Ld. Counsel for Appellant
submitted that the RP had conducted the CIRP of the Corporate Debtor in a
malafide manner whereby recovery by the secured Financial Creditors was
accorded undue primacy at the cost of the interests of the Corporate Debtor.
The RP had allowed the secured Financial Creditors to unduly inflate their
claims which claims did not mirror the position reflected in the financial
records of the said Financial Creditors. The Adjudicating Authority had also
brushed aside the objections raised by the Appellant to the exaggerated claims
filed by the Financial Creditors on the pretext that there was no inter se
complaint or objections by the Financial Creditors in respect of each other’s
claim. It was emphatically asserted that this was not a fair and transparent
manner of handling the serious objections raised by the Appellant with regard
to inflated claims having been allowed by the RP. The Adjudicating Authority
also erred in approving the resolution plan even though the plan attributes

Print For: Navneet & Co. Page 4 of 17 Printed: 10.09.2025

 (2025) ibclaw.in 344 NCLAT
IBC Laws® Dr. Arabinda Kumar Rath v. Siba Kumar Mohapatra

were not beneficial for the Corporate Debtor on account of inflated claims
having been allowed for the Secured Financial Creditors.

4. The valuation of the Corporate Debtor had been artificially exaggerated with
the fair value having been kept at Rs 50.73 Cr. and the liquidation value at Rs
40.51 Cr. The basis for arriving at the above valuation figures was not clear.
Inspite of the request of the Appellant made to the RP for providing the
valuation report, the request had been rejected. Assertion was also made that
the RP did not disclose all requisite material information in the RFRP while
inviting plans from the PRAs. It was not disclosed that the land on which the
hospital business of the erstwhile Corporate Debtor was running was lease land
granted by the Government of Odisha which lease was for a specific purpose.
The PRAs and SRA were unaware of the conditions of the lease basis. The Lease
Deed clearly stipulated that the land was given to the Corporate Debtor for a
specific purpose and any change of the conditions of lease would lead to its
termination. As this aspect was not brought to the attention of either the CoC
or the PRAs by the RP, hence, the resolution plan of the SRA did not deal with
these aspects of Lease Deed and the permission to mortgage. It was therefore
contended that the current resolution plan of the SRA was bound to fail.

5. Refuting the contentions of the Appellant, Shri Gaurav Mitra, Ld. Counsel for
the Respondent-RP asserted that the Appellant who was a member of the
suspended management of the Corporate Debtor has failed to substantiate any
of the grounds enumerated under Section 61(3) of the IBC basis which the
approval of the resolution plan could have been challenged. It was further
added that the plan submitted by the SRA has been fully implemented. The
SRA had already paid Rs 47.05 Cr. to both Financial and Operational Creditors
besides paying for CIRP costs. The SRA had also infused fresh capital by issue
of shares and put in place a new Board of Directors and the cancer hospital was
already operational under the leadership of a reputed, experienced and highly
decorated oncologist. It was also submitted that the objections raised by the
Appellant with regard to alleged inflated claims of the Financial Creditors was
misleading. Emphasising that both the Secured Financial Creditors had public
profile and therefore could not have behaved in an unbecoming manner, it was
added that TDB was a statutory body set up by the Ministry of Science and
Technology, Govt. of India, while the other Financial Creditor-ISARC was a
consortium of banks which included a public-sector bank namely IDBI Bank.

Print For: Navneet & Co. Page 5 of 17 Printed: 10.09.2025

 (2025) ibclaw.in 344 NCLAT
IBC Laws® Dr. Arabinda Kumar Rath v. Siba Kumar Mohapatra

6. It is also contended that the charge made by the Appellant that the
resolution plan of the SRA suffered from deficiencies as the RFRP was silent
about the land lease deed of the erstwhile Corporate Debtor lacks foundation.
Asserting that there was no evidence of non-compliance of the lease-deed, it
was submitted that there was no change in the land-use since the SRA was also
running a hospital akin to what was being run by the Corporate Debtor but for
the fact that it was being run on a more expanded scale along with scope for
development of a Research Centre in the future. It was vehemently contended
that the Appellant had no locus to comment on whether there had been any
breach of any conditions of the lease as it was the Government of Odisha which
was the appropriate entity to decide on whether there was any deviation from
the terms and conditions of the Lease Deed. Furthermore, the RP had taken
appropriate and sufficient steps to keep the Government of Odisha apprised of
the status of CIRP and the filing of resolution plan. Moreover, the fact that the
SRA was to take all steps in line with the order of the NGT for forest clearance
had also been communicated by the RP to the CoC including the factum that
additional time was required by the SRA for filing of application for forest
clearance under the Forest Conservation Act, 1980.

7. We have duly considered the arguments advanced by the Learned Counsels

for both the parties and perused the records carefully.

8. The primary objection of the Appellant on the conduct of the RP was that the
claims admitted in respect of the two Financial Creditors were not in
conformity with their respective financial records and that the RP had
manipulatively allowed them to artificially balloon their claims. Elucidating
their arguments, it was stated that the claim of ISARC as on 10.06.2018 was Rs
39.20 Cr. However, the amount which had been admitted by the RP was Rs
60.04 Cr. It was alleged that the RP has also not taken into consideration the
fact that the Corporate Debtor had paid certain sums of money to one of the
consortium lenders – IDBI Bank. As regards TDB, it was pointed out that as
against the 24th Annual Report of the TDB for 2020-21 which depicted only an
amount of Rs 11.14 Cr. as due from the Corporate Debtor, the claim which had
been admitted by the RP was Rs 30.19 Cr. Like in the case of ISARC, even in the
case of TDB, the RP did not factor in the payment of certain sums of money by
the Corporate Debtor to TDB. The quantum of debt was thus not quantified by
the RP appropriately as it did not take into consideration the paid amounts. It
was vehemently contended that though serious objections were raised by the

Print For: Navneet & Co. Page 6 of 17 Printed: 10.09.2025

 (2025) ibclaw.in 344 NCLAT
IBC Laws® Dr. Arabinda Kumar Rath v. Siba Kumar Mohapatra

Appellant before the Adjudicating Authority on the manner in which the RP

had admitted the claims, the same was dismissed by the Adjudicating Authority
on the flimsy and technical ground that since there was no inter se complaint
on the quantum of claims amongst the two Secured Financial Creditors, the
Appellant had no grounds to press on with their objections. Simply because
TDB which had initially contested the claims filed by ISARC but did not persist
with their objection to the claim of ISARC, this was not a valid ground to
dismiss the objections raised by the Appellant.

9. Per contra, the RP contended that the Appellant has cleverly attempted to
truncate the claims of the Secured Financial Creditors by selective use of
documents to misrepresent facts. It was submitted by the RP that with a view to
buttress their distorted contention that the outstanding amount of TDB was
only Rs 11.14 Cr, the Appellant has relied on the 25th Annual Report of TDB for
2021 and selectively confined itself to the entry made therein under the
heading “Provision of interest and additional interest”. The Appellant has
deliberately not brought to the fore the fact that following an arbitration
initiated by them, an Arbitration Award was announced on 25.05.2015. This
award granted TDB Rs 14.98 Cr. along with interest pendente lite @ 15% p.a.
from 19.08.2011 till the date of award and future interest @ of 15% till
realization. When reckoned along with arbitration award amount, the
outstanding dues to TDB worked out to Rs 30.19 Cr. and hence the claim of Rs
30.19 Cr. has been correctly admitted by the RP on the basis of documents
appended to Form-C. As regards their allegations that the claim raised in
respect of ISARC was also inflated, it was asserted that the allegation of the
Appellant was equally misconceived. It was pointed out that the order of the
Adjudicating Authority admitting the Corporate Debtor into CIRP was based on
the default submitted by the ISARC-Financial Creditor as on 10.06.2018.
However, since the Corporate Debtor was admitted into CIRP on 08.12.2021,
interest amount had clearly accrued thereon as follows: (a) loan of Rs
1,00,00,000 at 14% for IDBI’s facility dated 06.08.2000 along with 2% penalty
and 16.5% along with 2.05% penalty for IDBI loan dated 23.04.2004; and (b)
loan of Rs 5,00,00,000 at 11.5% for Axis Bank’s term loan and Rs 10,77,88,871
at 10.75% on its funded interest term loan. Hence the claim of ISARC was
realistic and not artificially bloated as alleged by the Appellant. Moreover, the
Appellant had only taken cognisance of the orders of the DRT dated 22.04.2022
in respect of ISARC claim. It is the case of the RP that the order of DRT was

Print For: Navneet & Co. Page 7 of 17 Printed: 10.09.2025

 (2025) ibclaw.in 344 NCLAT
IBC Laws® Dr. Arabinda Kumar Rath v. Siba Kumar Mohapatra

only in respect of the loan obtained from Axis Bank and did not reflect the loan
received by the Corporate Debtor from the other consortium lender that is the
IDBI Bank.

10. At this stage it may be useful to notice the treatment given by Adjudicating
Authority in the impugned order to the purported allegation of the Appellant
that the claims lodged by the two Financial Creditors were inflated and
unrealistic. We find that the Adjudicating Authority has noticed that on an
earlier occasion, TDB had raised concerns on the veracity and tenability of the
claims lodged by ISARC. The TDB had objected to the claim amount of ISARC
as accepted by the RP. Aggrieved with the RP in this regard, the TDB had filed
IA No. 903 of 2021 before the Adjudicating Authority seeking details of Form-C
which had been filed by the ISARC regarding their claims. This prayer of the
TDB had been allowed by the Adjudicating Authority on 04.10.2022 following
which the RP had furnished the detailed particulars contained in Form-C filed
by the ISARC to TDB. We notice that the TDB after receiving Form-C of ISARC
did not pursue the matter any further which amply manifests that the doubts
entertained by TDB regarding the claims filed by ISARC stood dissipated. This
clearly exhibits that the TDB had elected not to dispute the claims admitted
qua ISARC and did not raise any further discrepancies on the claims of ISARC.

11. In such circumstances, we are of the considered view that it was only
reasonable on the part of the Adjudicating Authority to infer that the
apprehensions of the TDB in respect of the claim filed by ISARC stood allayed.
We are also inclined to agree with the RP that when there were only two
Financial Creditors in the CoC and they had settled their doubts and
ambiguities about each other’s claim and there was no inter se dispute between
them on the quantum of claim, they had actually opted and chosen to put a
quietus to the matter. That being the ground situation, the suspended
management of the Corporate Debtor has no locus to raise unfounded
allegations about the quantum of claims claimed by the Financial Creditors and
admitted by the RP. When TDB was fully satisfied about the fairness and
reasonableness of the claim filed by the other Financial Creditor, we find no
reasons to disagree with the findings returned by the Adjudicating Authority
that merely because the Appellant was the personal guarantor of the ex-
management, they cannot be seen to unduly persist with their allegations that
the claims of the Financial Creditor were inflated and exaggerated to the
detriment of the Corporate Debtor.

Print For: Navneet & Co. Page 8 of 17 Printed: 10.09.2025

 (2025) ibclaw.in 344 NCLAT
IBC Laws® Dr. Arabinda Kumar Rath v. Siba Kumar Mohapatra

12. We now proceed to peruse the resolution plan of the SRA to see how it has
dealt with the claims lodged by the Secured Financial Creditors and
Operational Creditors. In respect of the proposed payment to the Secured
Financial Creditors, the plan abstract of the SRA is as reproduced below:

Secured Amount Claim 90 days Total % of

Financial Claimed Admitted from claim
Creditors termination admitted
(Payment of Lease
Bifurcation) and Service
agreements
(charge
free) or
NCLT order
whichever
is later
a T e c h n o l o g y 3028,38,962 3019,15,435 1419,00,000 1419,00,000 47%
Development
Board
b India SME Asset 6004,96,232 6004,97,968 2881,00,000 2881,00,000 48%
Reconstructi on
Company
Limited
Secured 9033,35,194 9024,13,403 4300,00,000 4300,00,000
financial
creditors (other
than financial
creditors
belonging to
any class of
creditors)

We find that as against the admitted claim of Rs 30.19 Cr. of TDB, the latter had
received Rs 14.19 Cr. which is 47% of their admitted claim. ISARC had also been
paid Rs 28.81 Cr. which was 48% of their admitted claim. The Operational
Creditors including workmen, employees, statutory government dues and other
Operational Creditors have all been provided for 100% of their admitted claim
in the plan as may be seen at page 146 of Appeal Paper Book (“APB” in short).
It is also an undisputed fact that the SRA has paid the CIRP costs. When the
resolution plan of the SRA took care of the interest of every stakeholder
substantively and no complaint has been received from either the Secured
Financial Creditors or Operational Creditors of having been made to suffer any
arbitrary hair-cut, we do not see any merit in the bogey of admission of inflated
claims by the RP as raised by the Appellant.

Print For: Navneet & Co. Page 9 of 17 Printed: 10.09.2025

 (2025) ibclaw.in 344 NCLAT
IBC Laws® Dr. Arabinda Kumar Rath v. Siba Kumar Mohapatra

13. This brings us to the second limb of argument of the Appellant that the RP
failed to effectively discharge his statutory responsibilities under the IBC in not
having disclosed crucial material information in the RFRP document with
regard to the land on which the hospital of the erstwhile Corporate Debtor was
running, in that it was a leased property, the lease having been granted by the
Government of Odisha on 02.11.2000. Submission has been pressed by the
Appellant that the lease was for a specific purpose and the Lease Deed clearly
specified that any change in the conditions of the lease would lead to its
termination. It is the case of the Appellant that the RP did not include the
termination aspect of the lease in the RFRP and the resolution plan of the SRA
was silent on this count. The CoC was also informed about the lease much later
on 03.05.2023 during the 12th CoC meeting by the RP by which time the plan of
the SRA had already been approved by the CoC. The RP had only apprised the
CoC of the forest clearance aspect while keeping the CoC in the dark regarding
the directions of the Government of Odisha regarding compliance with the
condition of the Lease Deed and mortgage permission. Pointing out another
fallacy of the RP, it was submitted that the resolution plan of the SRA got
approved without taking consent from the Government of Odisha. It was
therefore strenuously contended by the Appellant that the Adjudicating
Authority had erroneously held that the RP had taken sufficient steps to keep
the Government of Odisha informed about the CIRP of the Corporate Debtor
and the resolution plan of the SRA. Attention was adverted to the decision of
this Tribunal in SEL Manufacturing Company Ltd. Vs Punjab Small Industries
& Export Corporation Ltd. in CA(AT)(Ins) No. 881 of 2022 wherein it has
been held by the Tribunal that the rights of Land Development authorities on
assets owned by them cannot be overridden by provisions of IBC. It was
canvassed that present is a case where non-compliance to the terms and
conditions of the Lease Deed was writ large and hence their objections to the
resolution plan ought to have been sustained by the Adjudicating Authority.

14. To arrive at our findings on this issue, it would be constructive to notice the
relevant excerpts of the letter dated 03.09.2022 from the Government of Odisha
addressed to the RP with respect to the Lease Deed which reads as follows:

C. The land schedule involved in the case is a leasehold land allotted by the
GA & PG Deptt. for the purpose of establishment of “Information Technology
Project on Radiation Therapy, Allied Sciences and Cancer Institute“. GA &
PG Deptt. has not been impleaded as a party before the Hon’ble Tribunal.

Print For: Navneet & Co. Page 10 of 17 Printed: 10.09.2025

 (2025) ibclaw.in 344 NCLAT
IBC Laws® Dr. Arabinda Kumar Rath v. Siba Kumar Mohapatra

The clause (xiv) of the Register Lease Deed provides that, the lessee shall not
without the consent in writing of the lessor use or permit the use of the said
land for any purpose other than that for which it is leased or transfer the
same without such consent. Further Clause-(xvi) of the Register Lease Deed
provides that in the event of the closure/dissolution/defunct of the institution
M/s Medirad Tech India Ltd., New Delhi, the lease land along with building if
any thereon shall be the property of Government.

Further, it is pertinent to mention here that the land schedule involved in

respect of the land relating to Mz-Jayadev Vihar is recorded in forest
classification. As per the order of the Hon’ble National Green Tribunal in OA
No. 29/2019, the user agency is required to regularise the matter by filing
forest diversion proposal before the competent authority as per the provisions
of F.C. Act, 1980.

You are therefore requested to take cognizance of the specific conditions

contained in the Registered Lease Deed No. 6193 dtd. 03.11.2000 and No.
1435 dtd. 24.02.2006 read with the conditions mentioned in the NOC Order
No. 2597 dtd. 28.02.2001 and No. 13985 dtd. 31.12.2002, while proceeding to
resolve the insolvency matter as per the provisions of Insolvency &
Bankruptcy Code (IBC) with the orders of Hon’ble National Company Law
Tribunal (NCLT). Any deviation in overriding the terms and conditions of
lease deeds executed by Government in GA & PG Department and the orders
of the NOC issued at Government level may lead to future litigation.

(Emphasis supplied)

15. When we see the above letter from the Government of Odisha dated
03.09.2022 addressed to the RP, we find that the Government of Odisha had
clearly noticed that the Corporate Debtor had been admitted into CIRP vide
order dated 08.12.2021. This letter only informs the RP that while proceeding
to resolve the insolvency matter in terms of the provisions of IBC, the RP may
take cognisance of the specific condition contained in the Registered Lease
Deed No. 6193 dated 03.11.2000 and No. 1435 dated 24.02.2006 to desist from
any deviation in adhering to the terms and conditions of the Lease Deeds to
avoid future litigations. Perusal of the contents of this communication does not
in any manner manifest that the RP had committed any breach of the Lease
Deed. All that the Government of Odisha had communicated in the said letter

Print For: Navneet & Co. Page 11 of 17 Printed: 10.09.2025

 (2025) ibclaw.in 344 NCLAT
IBC Laws® Dr. Arabinda Kumar Rath v. Siba Kumar Mohapatra

to the RP was to take adequate safeguards and precaution that the terms and
conditions of Lease Deed were not deviated from or get overrun in any manner.
Material placed on record also show that the RP had sent a reply on 29.08.2022
and 18.11.2022 to the Government of Odisha that all the points contained in
their letter of 03.09.2022 had been taken cognisance of.

16. We therefore do not find any material on record which substantiates that
the Lessor-Government of Odisha had raised any such objection that the land
lease deed has been violated. No permission was either necessary from
Government of Odisha since there was no change in the purpose of the use of
the land. Neither was the land being put for sale. The business activity of the
SRA pursuant to approval of resolution plan was for the same purpose for
which Lease Deed had been granted to the suspended management.
Furthermore, as to whether the terms of conditions of the Lease Deed had been
breached or not is an issue to be examined and determined by the Government
of Odisha, the latter being the Lessor. The Appellant being the suspended
management of the Corporate Debtor has no locus standi to decide whether the
Lease Deed had been breached or not. Furthermore, when we see the manner
how the Corporate Debtor was using the leased land, admittedly it was for the
purpose of running a 50 bedded cancer hospital. When we see the terms of the
resolution plan, the SRA was also intending to continue with running a cancer
hospital, albeit, with an expanded capacity of 150 beds. It is therefore self-
evident that there is no change in the land-use except that the scale of the
hospital has been enlarged. We also notice that the Adjudicating Authority at
paragraphs 18 to 25 of the impugned order noticed in detail the exchange of
communication between the RP and the Government of Odisha about the
status and progress of the CIRP proceedings. Hence, the Adjudicating Authority
did not commit any error in coming to the conclusion that the RP had taken
appropriate steps to keep the Government of Odisha apprised of the status of
the CIRP and on the filing of resolution plan duly approved by the CoC. As
regards forest clearance too, the RP had sent a letter to the Government of
Odisha on 18.11.2022 requesting for additional time to file an application
seeking forest clearance under the Forest Conservation Act 1980, since the
resolution plan was pending approval of the Adjudicating Authority and that
the SRA was to take necessary steps in line with the order of the NGT for forest
clearance. We therefore do not find any infirmity in the finding returned by the
Adjudicating Authority that no breach of the lease deed had been pointed out

Print For: Navneet & Co. Page 12 of 17 Printed: 10.09.2025

 (2025) ibclaw.in 344 NCLAT
IBC Laws® Dr. Arabinda Kumar Rath v. Siba Kumar Mohapatra

by the Government of Odisha and that the RP had scrupulously complied to the
suggestions and directions of the Government of Odisha which was the Lessor.

17. The reliance placed by the Appellant on SEL Manufacturing Company Ltd
judgment supra is also misplaced since in that case there was non-compliance
to the terms and conditions of the Lease Deed with the SRA not having paid the
demand for enhanced land cost raised by the land holding authorities much
before the initiation of CIRP. The present is not a case, where any such demand
from any sovereign land authority remained unmet. Nor do we find any
communication from the Government of Odisha citing breach of the terms of
Lease Deed by the SRA.

18. It is also one among the many objections raised by the Appellant that the
RP did not conduct the valuation exercise properly. The valuation exercise was
allegedly facilitated by the RP in a manner which unduly benefitted the Secured
Financial Creditor at the cost and detriment of the interest of the Corporate
Debtor. It was also contended that the valuation report of the Corporate Debtor
was not shared with the Appellant inspite of requesting for these reports.

19. When we see the material available on record, we notice that in accordance
with the CIRP Regulations and Section 25 of IBC, the RP had appointed
registered valuers for conducting valuation exercise. The obligation of the RP
under CIRP Regulations and IBC is limited only to the appointment of the
registered valuers, while the valuation is to be approved by the CoC under the
mandate of commercial wisdom. Thus, the RP cannot be faulted on this count
as it had discharged its statutory responsibility having appointed the valuers
and submitted their report to the CoC for its consideration.

20. The approval of the valuation of Corporate Debtor is an exercise which falls
under the purview of commercial wisdom undertaken by the CoC. The scope of
interference by the Adjudicating Authority in the commercial wisdom exercised
by the CoC is minimal. Since the Appellant had no right to vote in the meeting
of the CoC, they cannot be said to have suffered from any prejudice for not
being provided with the valuation report. Whether the detailed valuation report
was placed before the Appellant or not is immaterial and irrelevant since it is
only the members of the CoC who were required to exercise the commercial
wisdom on the valuation reports placed before them and not the Appellant who
did not have the right to exercise their vote.

Print For: Navneet & Co. Page 13 of 17 Printed: 10.09.2025

 (2025) ibclaw.in 344 NCLAT
IBC Laws® Dr. Arabinda Kumar Rath v. Siba Kumar Mohapatra

21. Coming to the non-sharing of the valuation reports, as per the CIRP
regulations, the RP is not required to share the valuation with any entity except
the members of the CoC that too after obtaining confidentiality undertaking.
The Adjudicating Authority has rightly held at para 29 that there is no
provision under IBC or the CIRP Regulations framed thereunder which
necessitates the valuation report of the Corporate Debtor to be shared with the
suspended management of the Corporate Debtor. The confidential nature of
the fair value and liquidation value of the Corporate Debtor is highlighted in
Regulation 35(2) of the CIRP Regulations and the RP is not obligated to share
these reports with anyone but for the members of the CoC. The RP had not
violated the statutory construct of the IBC in not acceding to the request of the
Appellant to provide them with the valuation report. We therefore do not find
any merit in the contention of the Appellant that by not getting access to the
valuation reports, they were denied their due. On the contrary, we affirm the
decision of the Adjudicating Authority that in the given circumstances, no
irregularity stands proven to have been committed by the RP.

22. Another argument canvassed by the Appellant was that the settlement
proposed by them under Section 12(a) had not been paid any heed either by the
RP or the CoC. We have no doubt in our mind that the RPs jurisdiction is
restricted only to presenting any settlement offer before the CoC and it strictly
lies on the commercial wisdom of the CoC to accept or reject the aforesaid
offer. Having placed the Appellant’s settlement offer before the CoC, the RP
therefore cannot be faulted on this score. The settlement offer of the Appellant
under Section 12-A had been discussed in the 6th CoC meeting. ISARC during
the said CoC meeting had agreed to review the settlement offer though it is also
an undisputed fact that the Appellant did not receive any response from ISARC
on their settlement offer. The representatives of TDB during the meeting had
also stressed that any repayment plan in terms of the settlement had to also
cater to the interests of TDB and not only that of ISARC. If the Financial
Creditors did not respond to the offer and CoC proceeded ahead to approve the
resolution plan of the SRA, it was an act of exercise of commercial wisdom of
the CoC. The Financial Creditors were not obligated to respond to the
settlement offer. It is settled law that the collective business decision of the
CoC cannot be interfered with either by the RP or the Adjudicating Authority.
Hence the complaint of the Appellant that their settlement offer did not
receive deserve due regard is misplaced and cannot be sustained.

Print For: Navneet & Co. Page 14 of 17 Printed: 10.09.2025

 (2025) ibclaw.in 344 NCLAT
IBC Laws® Dr. Arabinda Kumar Rath v. Siba Kumar Mohapatra

23. Much emphasis was laid by the Respondent that it is settled law that to
challenge the order of the Adjudicating Authority approving a resolution plan,
the same has to be strictly confined to the grounds set out in Section 61(3) of
the IBC as has been held by the Hon’ble High Court in Arcelor Mittal (P) Ltd.
Vs Satish Kumar Gupta 2018 SCC Online SC 1733 wherein it has been held
that “an appeal from an order approving such plan is only on the limited grounds
laid down in Section 61(3)”. It was vehemently contended that the Appellant has
failed to show any irregularity or infraction or breach of any of the grounds
outlined under Section 61(3) of the IBC. Since the Appellant is trying to reopen
the resolution plan for adjudication on grounds which are beyond the purview
of the Appellate Authority, the appeal deserves to be set aside.

24. The resolution plan was approved with 100% vote share in the 9th CoC
meeting on 06.06.2022. The plan having been approved by full majority, we are
of the considered view that the Adjudicating Authority did not commit any
error while approving the resolution plan after noting its satisfaction about the
plan being compliant to the provisions of the IBC in terms of Section 30(2) of
the IBC. Law is now well settled that the jurisdiction of the Adjudicating and
Appellate Authorities to interfere with approval of the resolution plan is
limited. The scope of judicial review is confined to the provisions contained in
Section 30(2) of the IBC for the Adjudicating Authority and Section 61(3) for
the Appellate Authority. There is only limited review which can be exercised by
the Adjudicating Authority or the Appellate Authority.

25. We are guided by the judgement of the Hon’ble Supreme Court in Ngaitlang
Dhar v. Panna Pragati Infrastructure Private Limited in CA No. 3665-3666 of
2020 wherein it has been held: –

“31. It is trite law that ‘commercial wisdom’ of the CoC has been given
paramount status without any judicial intervention, for ensuring completion
of the processes within the timelines prescribed by the IBC. It has been
consistently held that it is not open to the Adjudicating Authority (the NCLT)
or the Appellate Authority (the NCLAT) to take into consideration any other
factor other than the one specified in Section 30(2) or Section 61(3) of the
IBC.

It has been held that the opinion expressed by the CoC after due deliberations
in the meetings through voting, is the collective business decision and that the

Print For: Navneet & Co. Page 15 of 17 Printed: 10.09.2025

 (2025) ibclaw.in 344 NCLAT
IBC Laws® Dr. Arabinda Kumar Rath v. Siba Kumar Mohapatra

decision of the CoC’s ‘commercial wisdom’ is non justiciable, except on

limited grounds as are available for challenge under Section 30(2) or Section
61(3) of the IBC. This position of law has been consistently reiterated in a
catena of judgments of this Court, including:

(i) K. Sashidhar v. Indian Overseas Bank

(ii) Committee of Creditors of Essar Steel India Limited through

authorized signatory v. Satish Kumar Gupta,

(iii) Maharashtra Seamless Limited v. Padmanabhan Venkatesh,

(iv) Kalpraj Dharamshi v. Kotak Investment Advisors Limited,

(v) Ghanashyam Mishra and Sons Private Limited through the

Authorized Signatory v. Edelweiss Asset Reconstruction Company
Limited through the Director”

26. As long as the statutory provisions of the IBC and the CIRP Regulations
framed thereunder are complied with, it is the commercial wisdom of the
requisite majority of the CoC which is to negotiate and accept a resolution
plan. Once all the mandatory requirements have been duly complied with and
taken care of, the Adjudicating Authority cannot deal with the merits of
Resolution Plan unless it is found it to be contrary to the express provisions of
law and against the public interest. There is neither any material irregularity
nor contravention of any provision of law by the CoC which has been justifiably
substantiated by the Appellant. In the present case when no valid grounds have
been made out to challenge the approval of the resolution plan, the legislative
fiat of the IBC that the Adjudicating Authority cannot trespass upon the
business decision of the CoC holds ground. We have no doubts in our mind that
the plan has been rightly approved by the Adjudicating Authority on having
successfully passed the muster of commercial wisdom of CoC.

27. In view of the reasons stated above, we find no good grounds to interfere
with the impugned order. We find no merit in the Appeal. The Appeal is
dismissed with no costs.

[Justice Ashok Bhushan]

Chairperson

Print For: Navneet & Co. Page 16 of 17 Printed: 10.09.2025

 (2025) ibclaw.in 344 NCLAT
IBC Laws® Dr. Arabinda Kumar Rath v. Siba Kumar Mohapatra

[Barun Mitra]
Member (Technical)

Place: New Delhi

Date: 07.05.2025

Original judgment copy is available here.

—-

Copyright © IBC Laws. All Rights Reserved.

–––

Disclaimer: While every effort is made to avoid any mistake or omission, this document
including casesummary/brief about the decision/ add. info/headnote/ judgment/order/ act/
rule/ regulation/ circular/ notification is being circulated on the condition and understanding
that the publisher would not be liable in any manner by reason of any mistake or omission or
for any action taken or omitted to be taken or advice rendered or accepted on the basis of this
document. The authenticity of this text must be verified from the original source. Read more
Disclaimer page.

Print For: Navneet & Co. Page 17 of 17 Printed: 10.09.2025