PIRP period may be extended where the repayment plan is approved in principle, pending competent-authority approval.

Indian Bank initiated personal insolvency resolution process (“PIRP”) proceedings under Section 95 of the Insolvency and Bankruptcy Code, 2016 (“IBC”) against the personal guarantors.

The Adjudicating Authority ordered commencement of the PIRP on 20 February 2026 and appointed the Resolution Professional; public announcement was made on 27 February 2026, with 19 March 2026 fixed as the last date for submission of claims

Following constitution of the Committee of Creditors (“CoC”), meetings were held on 2 April, 6 April, 5 May, 29 May and 26 June 2026.

During the fourth meeting, the guarantors submitted repayment plans offering ₹3,27,50,000 plus PIRP costs, payable within 90 days.

The financial creditor approved the plans in principle, subject to approval by the competent authority and completion of e-voting

The statutory 120-day PIRP period had expired on or about 20 June 2026.

In its meeting dated 26 June 2026, the creditor resolved to seek a further extension and requested the Resolution Professional to move appropriate applications.

Applications IA Nos. 1034/2026 and 1035/2026 were accordingly filed before the NCLT, Ahmedabad, but were rejected by orders dated 8 July 2026

Indian Bank challenged those orders before the NCLAT and sought further time to complete the PIRP process

Whether the Adjudicating Authority ought to have granted an extension of the PIRP period where the guarantors’ repayment plans had been approved in principle by the financial creditor, but formal approval of the competent authority and e-voting remained pending?

Whether, in the circumstances, the NCLAT should set aside the rejection orders and grant further time for completion of the PIRP proceedings?

The proceedings arose under Section 95 of the IBC, which permits a financial creditor to initiate insolvency resolution proceedings against a personal guarantor

The NCLAT applied the PIRP framework and the principle that the process should facilitate repayment to the financial creditor and may be afforded reasonable additional time where a viable repayment arrangement has been substantially agreed and only formal approvals or procedural steps remain pending

No specific judicial precedent was cited in the order.

The Tribunal treated the 120-day period as having expired but found that, in the particular circumstances, a limited extension was justified to complete the agreed process

The NCLAT found that the guarantors had proposed repayment plans for ₹3,27,50,000 plus PIRP costs after substantial negotiations, and that the financial creditor had approved those plans in principle

The remaining matters were approval by the Bank’s competent authority and completion of e-voting, rather than substantive disagreement regarding the repayment proposal

Since the purpose of the PIRP is repayment to the financial creditor, the Tribunal held that refusing any extension despite the near-final settlement would defeat the object of the process.

The consensual position of the parties and the existence of an in-principle-approved repayment plan therefore warranted interference with the NCLT’s orders

The NCLT’s orders dated 8 July 2026 rejecting IA Nos. 1034/2026 and 1035/2026 were set aside.

The NCLAT extended the PIRP period in both proceedings by a further 45 days from 19 August 2026, directing the parties to complete the entire PIRP process within that period

There was no order as to costs, and pending interlocutory applications were disposed of