In Brief
DBS Bank, a secured financial creditor holding USD 50 million debt backed by superior security interests, challenged the pro-rata distribution of resolution proceeds in an insolvency case involving Ruchi Soya Industries. The amended Insolvency Code (2019) provides dissenting financial creditors protection via Section 30(2)(b)(ii), requiring payment no less than their liquidation value. The Supreme Court held that dissenting secured creditors are entitled to receive the minimum monetary value of their security interest as calculated under liquidation principles, though not permitted to directly enforce the security. The Court referred the interpretation of this entitlement to a larger bench, finding tension with prior case law.
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