NCLAT Grants Relief To Reliance Infrastructure, Stays Insolvency Proceedings
NCLAT Grants Relief To Reliance Infrastructure, Stays Insolvency Proceedings
Introduction
The National Company Law Appellate Tribunal (NCLAT) has granted a significant relief to Reliance Infrastructure by staying the insolvency proceedings against the company. The NCLAT's order came in an appeal filed by Reliance Infrastructure against the National Company Law Tribunal's (NCLT) decision to admit an insolvency plea filed by IDBI Trusteeship Services Ltd.
Factual Background
IDBI Trusteeship Services Ltd had filed a petition for initiating corporate insolvency resolution process (CIRP) against Reliance Infrastructure in April 2022, alleging a default of ₹88.68 crore as of August 28, 2018, plus interest. The default was related to payment of 10 invoices raised between 2017 and 2018 by Dhursar Solar Power Private Ltd (DSPPL) for supplying solar energy to Reliance Infrastructure.
Procedural Background
The NCLT, Mumbai Bench, had admitted the insolvency plea filed by IDBI Trusteeship Services Ltd on May 30, 2025. Reliance Infrastructure filed an appeal against this order before the NCLAT, which has now stayed the insolvency proceedings.
Issues Involved
1. Insolvency Proceedings: Whether the NCLT's order admitting the insolvency plea against Reliance Infrastructure was valid.
2. Payment of Default Amount: Whether Reliance Infrastructure had made full payment of the default amount to Dhursar Solar Power Private Ltd.
Contentions of the Parties
Reliance Infrastructure's Contentions: Reliance Infrastructure contended that it had made full payment of ₹92.68 crore to Dhursar Solar Power Private Ltd towards claims of tariff, making the initiation of insolvency proceedings infructuous.
IDBI Trusteeship Services Ltd's Contentions: IDBI Trusteeship Services Ltd alleged that Reliance Infrastructure had defaulted on payment of ₹88.68 crore as of August 28, 2018, plus interest.
Reasoning and Analysis
The NCLAT has suspended the order passed by the NCLT admitting Reliance Infrastructure into Corporate Insolvency Resolution Process. The NCLAT's order suggests that Reliance Infrastructure's appeal has merit and that the insolvency proceedings may not be justified.
Final Decision
The NCLAT has stayed the insolvency proceedings against Reliance Infrastructure, granting relief to the company.
Potential Implications
The judgment may have implications for companies facing insolvency proceedings, highlighting the importance of filing appeals and seeking stays on orders that may have been passed without proper consideration of the facts and circumstances.
Law Settled
This judgment highlights the importance of considering the facts and circumstances of each case before admitting an insolvency plea. The NCLAT's order also underscores the need for the NCLT to carefully evaluate the evidence and contentions of the parties before passing orders.
