In Brief
In this case involving competing resolution plans for Essar Steel India Limited under the Insolvency and Bankruptcy Code, the Supreme Court clarified the scope and application of Section 29A, which bars certain ineligible persons from submitting resolution plans. The Court held that the relevant date for determining ineligibility is the time of submission of the resolution plan. Importantly, merely divesting shares or control of non-performing assets does not cure ineligibility; the only cure is payment of all overdue amounts before plan submission. The Court emphasized that the corporate veil can be pierced to identify persons acting jointly or in concert, including through family relationships and group company structures. The Court set aside findings that Numetal was eligible and gave both applicants an opportunity to pay off related non-performing debts within two weeks to cure their ineligibility, allowing them to resubmit plans for the Committee of Creditors' consideration.
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