NCLAT Upholds NCLT's Power To Set Aside Resolution Plans Obtained Through Fraud Or Collusion

The National Company Law Appellate Tribunal (NCLAT) has held that under Section 65 of the Insolvency and Bankruptcy Code (IBC), the NCLT can nullify even an approved resolution plan if it is found tainted by fraud or malicious intent.

The appellate bench emphasised that such provisions apply at any stage, regardless of whether the corporate insolvency resolution process (CIRP) has advanced. 

The ruling stems from a dispute involving Logix Infrastructure and Expert Realty Professionals, where collusion and deceptive practices were established.

Upholding the NCLT’s decision, NCLAT reaffirmed that fraudulent acts cannot be shielded by completed insolvency proceedings.

[Expert Realty Professionals Pvt v Logix Infrastructure Pvt]