Supreme Court Upholds CoC‑Approved IBC Resolution Plan – No Post‑Approval Negotiations for SRA

Overview The Supreme Court has ruled that a Successful Resolution Applicant (SRA) cannot back out of a plan after the Committee of Creditors (CoC) has approved it. The judgment reinforces the binding nature of plans under the Insolvency and Bankruptcy Code (IBC)." Key Developments The bench of Justice K.V. Viswanathan and Justice Vipul M. Pancholi declined to interfere with the findings of the National Company Law Tribunal (NCLT) and National Company Law Appellate Tribunal (NCLAT) . The lower tribunals had rejected the SRA’s plea to restore the EMD of ₹1 crore. The Court observed that the appellant tried to delay implementation by claiming the LoI was conditional, which was contrary to the approved plan. The judgment cited the 2021 Ebix Singapore Private Limited vs. Committee of Creditors case, reaffirming that no negotiations are allowed after CoC approval. Important Facts August 9, 2018 : CIRP against Oracle Home Textiles Ltd. commenced. February 2020 : NCLT permitted the suspended management to submit a resolution plan. May 10, 2021 : CoC approved the plan with 99.90 % voting share . After the SRA disputed the LoI, it failed to furnish the performance guarantee; the RP forfeited the ₹1 crore EMD . Subsequently, CoC voted 99.61 % for liquidation under Section 33(2) of the IBC. NCLT and NCLAT upheld liquidation; the matter reached the Supreme Court, resulting in the present judgment (2026 LiveLaw (SC) 562). UPSC Relevance The case illustrates how the IBC seeks to ensure a time‑bound, decisive resolution of distressed firms. Understanding the roles of Resolution Professional , CoC, and SRA is essential for GS 3 (Economy) questions on corporate governance and financial reforms. The judgment also highlights judicial interpretation of statutory provisions, a typical GS 2 (Polity) theme. Way Forward Stakeholders must treat the CoC’s approval as final. Any attempt to renegotiate after approval may be struck down as sub‑terfuge. Companies should ensure compliance with the LoI and performance guarantees to avoid forfeiture of the EMD. The ruling strengthens the credibility of the IBC’s swift resolution mechanism, aligning with the government’s objective of improving ease of doing business.