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Judgment
16.02.2026 : Heard counsel for the appellant.
This appeal has been filed against an order dated 15.12.2025 passed in I.A. No. 829/2024. The I.A. was filed by the appellant praying for direction to consider the scheme of compromise arrangement proposed by the applicant under Section 230 of the Companies Act, 2013. The application has been rejected. Adjudicating authority while rejecting the application in paragraph 8 has made following observations:
“8.Additionally, the applicant's claim that the Corporate Debtor qualifies as an MSME to avail the benefits of Section 240A of the Code is unsupported by any MSME certificate or documentary proof, either before the Liquidator or before this Tribunal. The applicant is also undergoing personal insolvency, his personal guarantee having been invoked, and his repayment plan having been rejected by this Tribunal vide order dated 09.06.2025 in IA No. 1630 of 2024. In view of the scheme being time-barred, already rejected by the SCC, unsupported by proof of MSME status, and proposed by an applicant who is himself in insolvency, no case is made out for granting the reliefs sought. Accordingly, we pass the order as hereunder:
ORDER
IA 829 of 2024 in CP (IB) 241 of 2021 stands rejected and disposed of.”
Learned counsel for the appellant challenging the order submits that insofar as MSME certificate is concerned, that is filed as Annexure A-2 to the appeal and at the time when scheme was submitted, appellant was clearly eligible and the personal insolvency commencement is subsequent to the submission of the scheme and the order dated 09.06.2025 is a subsequent order, where repayment plan has been rejected. It is submitted that adjudicating authority has not considered the eligibility of the applicant at the time when the scheme was submitted.
We have considered the submissions of the counsel for the appellant and perused the records.
Even for the argument sake, it is accepted that corporate debtor was MSME and appellant was entitled to submit a scheme, the fact remains that personal insolvency against the applicant has already commenced in which repayment plan has been rejected by the adjudicating authority on 09.06.2025. The above reason is sufficient to reject the scheme which was claimed by the appellant and even if on the day when scheme was submitted, appellant claims that it was eligible to submit the plan, subsequent event clearly makes a case for not accepting any such scheme submitted by person who has already been subjected to personal insolvency proceedings.
We thus find that sufficient reasons have been given by the adjudicating authority in paragraph 8 of the order for rejecting the scheme.
No grounds have been made out to interfere with the order impugned. The appeal is dismissed.