Supreme Court: Except in limited circumstances under Sections 30 and 31 IBC, NCLT/NCLAT cannot interfere with CoC’s commercial wisdom

Justices AM Khanwilkar, BR Gavai and Krishna Murari set asides NCLAT’s order and held, that “The appeal is a creature of statute and that the statute has not invested jurisdiction and authority either with NCLT or NCLAT, to review the commercial decision exercised by CoC of approving the resolution plan or rejecting the same”

It is clear that the statutory scheme is unambiguous, as interpreted by various judgments of this Court. Except for the restricted scope given under Sections 30 and 31 of the I&B Code, the commercial wisdom of CoC is not to be interfered with, the Supreme Court said, citing precedents of Committee of Creditors of Essar Steel India Ltd vs Satish Kumar Gupta and others, Maharashtra Seamless Ltd v Padmanabhan Venkatesh and others, K. Sashidhar vs. Indian overseas bank etc.

Justice BR Gavai in the same matter stated that It will therefore be clear that this Court has ruled, in undeniable words, that the appeal is a creature of law, and that the law has not vested discretion and power, either with NCLT or NCLAT, to review the demand for commercial exercised by CoC in accepting or rejecting the resolution proposal,

Case- Kalparaj Dharamshi and another vs Kotak Investment Advisors Ltd and Others and connected cases.

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