K. Sunil Kumar vs Union Of India & Ors.

Soumen Sen, C.J.

The Appellant has furnished a personal guarantee for the credit facilities availed of by M/s.Kasargod Power Corporation Limited (hereinafter referred to as ‘Corporate Debtor’). UCO Bank, the financial creditor, filed two company petitions under Section 95 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as ‘Code’) read with Rule 7(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantor to Corporate Debtors) Rules, 2019, against the present Appellant along with Mr.K.Vijay Kumar for initiating the insolvency resolution process for default of a debt amounting to ₹16,92,08,639.74/- (Rupees Sixteen Crores Ninety Two Lakhs Eight Thousand Six Hundred and Thirty Nine and Seventy four paise only). Due to default in repayment by the Corporate Debtor, the account was declared as Non-Performing Asset (NPA) on 31.03.2016. Thereafter, the proceedings was initiated under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002 in O.A.No.451 of 2021 before the Debts Recovery Tribunal-II, Hyderabad, for recovery of ₹9,81,87,390/- as on 31.08.2021. The said application was pending for adjudication. Meanwhile, M/s.MMS Steel & Power Private Limited filed CP(IBC)/50/KOB/2022 under Section 7 of the Code, which was dismissed under Section 10A of the Code. Despite this, another petition was filed for the same debt amount, without disclosing the earlier dismissal and the same was admitted on 19.01.2024.

We are not referring to the details of the dispute, as the limited relief sought is for giving an opportunity to the Appellant to prefer an appeal before the Appellate Authority.

The learned counsel for the Appellant has fairly submitted that the National Company Law Tribunal (NCLT) has disregarded the fact that 100% of the Committee of Creditors (CoC) had voted in favour of the Resolution Plan and despite such unanimity amongst the CoC, the Adjudicating Authority rejected the said plan on extraneous and irrelevant considerations.

The learned counsel for the Appellant has submitted that recently, in an appeal preferred by the financial creditor challenging the order dated 21.08.2025 passed by the NCLT, where the writ petition was not admitted due to the existence of an efficacious appellate remedy under Section 61 of the Code, the said view was upheld by this Division Bench vide judgment dated 13.01.2026. In view thereof, it is prayed that the Appellant may also be permitted to prefer an appeal against the same order of the NCLT, reasoning being the same, having regard to the facts and circumstances of the case.

The learned counsel appearing for the UCO Bank, the financial creditor, has submitted that all the members of the CoC have approved the resolution plan and that the extended submissions made on behalf of the Appellant are correct. However, UCO Bank has not preferred any appeal. In view of the fact that we have passed an order on13.01.2026, whereby, while upholding the order passed by the learned Single Judge, we extended the time to the Appellant therein to prefer an appeal within a period of 30 days from the date of the said order, we dispose of this appeal by giving similar benefits to the present Appellant. In the event, an appeal is preferred within a period of 30 days from today, the Appellate Authority may consider acceptance of the said appeal beyond the statutory period, having regard to the fact that the Appellant has prosecuted the matter with due diligence and the CoC have unanimously accepted the resolution plan. We, however, make it clear that we have not gone into the merits of the matter and it is for the Appellate Authority to decide the matter, in accordance with law.

In view thereof, this appeal is disposed of.