NCLAT Rejects Challenge to Grainotch’s Resolution Plan for KSG Sugar; Non-Disclosure of Scorecard Held Inconsequential
Pranav B Prem
The National Company Law Appellate Tribunal (NCLAT), New Delhi, has held that the failure to communicate the individual score and ranking of an unsuccessful resolution applicant does not vitiate the corporate insolvency resolution process. The Appellate Tribunal dismissed the appeal filed by the Consortium of Govindrao Sable and affirmed the approval of the successful resolution plan for KSG Sugar and Infra Corporation Private Limited submitted by Grainotch Industries Limited.
The appellant had challenged the order dated 1 October 2025 of the National Company Law Tribunal (NCLT), Mumbai Bench, which approved Grainotch’s resolution plan with 99.86 percent voting in favour by the Committee of Creditors (CoC). The primary contention was that under Step IV of the Resolution Plan Evaluation Process, the appellant was entitled to be informed of its individual scores and ranking but had only been provided with the Net Present Value. It was argued that non-disclosure of scores prejudiced its ability to match or improve its bid during the negotiation rounds.
The Bench comprising Justice Ashok Bhushan (Chairperson) and Barun Mitra (Technical Member) rejected the contention by noting that all bidders, including the appellant, were well aware of the scoring matrix applied for evaluating the resolution plans. The matrix allotted 24 marks to the Net Present Value and 56 marks to the upfront payment component. The Tribunal pointed out that the unsuccessful applicant had offered payment within twelve months while the successful resolution applicant proposed payment within thirty days, a factor that the CoC weighed in its commercial judgment.
The records showed that the negotiation process commenced on 12 March 2025 and continued across 27 rounds, in all of which the appellant participated. The Tribunal noted that the appellant was the highest bidder at one point but ultimately did not succeed after further bidding rounds and evaluation. The CoC thereafter approved the resolution plan of Grainotch Industries Limited after ensuring compliance with statutory requirements, and the Resolution Professional filed the application for approval supported by Form H, detailing the process followed.
The Appellate Tribunal held that the objections regarding non-communication of individual marks were inconsequential because the Insolvency and Bankruptcy Code does not mandate disclosure of scorecards to resolution applicants. It emphasized that such communication arose only from the CoC’s own evaluation framework and did not affect the legality of the process. Since the appellant was aware of the evaluation matrix and participated in the negotiation rounds with full knowledge of the criteria, the alleged grievance could not form the basis for setting aside the resolution plan.
The Tribunal further noted the submission by the Resolution Professional that the resolution applicants were not entitled to revise their financial proposals after the conclusion of the negotiation process, rendering the argument of prejudice purely academic. In conclusion, the Appellate Tribunal found no irregularity in the procedure followed in the resolution process and affirmed that the CoC had exercised its commercial wisdom in approving the successful plan. Accordingly, the NCLAT dismissed the appeal and upheld the approval of Grainotch’s resolution plan for KSG Sugar.
Appearance
For Appellant: Senior Advocate P Nagesh
For Respondents: Senior Advocotae Abhijeet Sinha with Advocates Abhijeet Sinha, Gautam Swarup, Gayatri Mohite, Dhrupad Vaghani, Rudra Deosthli and Kamakshi Maini for SRA; Advocates Heena Kochar, Kunal Mehta, Advocate for CoC; Advocate Madhavi Dosi, Advocates for RP.
Cause Title: Consortium of Govindrao Sable v. Pankaj Sham Joshi & Ors.
Case No: Company Appeal (AT) (Insolvency) No. 1598 – 1600 of 2025
Coram: Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical Member)
