Supreme Court Seeks Nationwide Data on NCLT Resolution Plan Delays

New Delhi: Taking a serious note of the delays in approval of resolution plans by various benches of the National Company Law Tribunal (NCLT), the Supreme Court has asked the Insolvency and Bankruptcy Board of India (IBBI) to furnish comprehensive nationwide data on petitions pending approval of resolution plans before various tribunals across the country and the reasons for such delays.

Expressing concern over prolonged delay in approving a resolution plan for AVJ Developers (India) that has been pending for nearly two years before the NCLT, a bench comprising Justices JB Pardiwala and KV Viswanathan asked both the NCLT Principal Bench at New Delhi and the IBBI to furnish comprehensive nationwide data on the number of applications pending for approval of resolution plans for debt-ridden companies and the reasons for such delays.

The apex court said it was unfortunate that an application for approval of a resolution plan for AVJ Developers has been pending before the principal Delhi bench of the National Company Law Tribunal for two years.

The court also asked the Delhi bench of the tribunal to state how many applications for approval of resolution plans were pending before it, for how long, and why the approval applications have not been adjudicated upon till date.

The IBBI and others have been asked to submit their reports within two weeks, after which the SC will decide on the next course of action on April 29.

The top court was hearing a plea by the AVJ Heights Apartment Owners Association and its suspended director against a NCLT's 2023 order that upheld the IIFL Finance's ₹85 crore claim in the insolvency process of the company.

The IIFL's claim was initially rejected by the Resolution Professional in 2020 but later allowed by the NCLT and upheld by the NCLAT in 2023.