SC: Committee of creditor’s resolution plan irrevocable

Landmark judgement in field of Insolvency and Bankruptcy field have been ruled that a resolution plan for stressed assets becomes irrevocable once approved by the Committee of creditors (CoCs) and submitted to the adjudicatory authority under the Insolvency and Bankruptcy Code.  Even the successful resolution applicant from seeking modification or withdrawal of the plan. A bench comprising Justices D Y Chandrachud and M R Shah refused to heed to pleas of successful resolution applicants seeking re- consideration or withdrawal of resolution plans, already submitted by the CoCs, considering the hiatus in giving effect to these plans because of pandemic caused delay in approval by statutory authorities.

IBC framework does not enable withdrawals or modifications of resolution plans, once they have been submitted by RP to adjudicating authority after CoCs approval. Resolution plans are not in nature of a traditional contract, and the process leading upto formulation and acceptance by CoC is regulated by insolvency framework.

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