Ashish Vashist Vs. S Kangayan – NCLT, Chennai Bench

The NCLT ruled that the commercial judgment of the Committee of Creditors (CoC) takes precedence in decisions regarding CIRP withdrawal, provided the statutory voting threshold is met. In this instance, the sole CoC member, holding 100% voting share, approved the withdrawal under Section 12A of the Insolvency and Bankruptcy Code, 2016.

A key aspect of the ruling was the NCLT's determination that the Resolution Professional's refusal to participate in the CoC meeting on April 6, 2026, did not invalidate the CoC's decision. The tribunal noted that the request to discontinue CIRP had arisen earlier in the process, which suggested it was not a last-minute attempt to avoid liquidation.

The NCLT also clarified that while prior non-cooperation or disputes over CIRP costs are relevant for expense payment, they do not block the statutory remedy for withdrawal. The decision emphasized that legitimate CIRP costs remain payable, directing the CoC member to clear the RP's dues within two weeks, subject to proper invoicing. This ruling restores the corporate debtor to its original active status.