Shareholders lack locus standi to challenge a resolution plan that has attained judicial finality and implementation.

The Corporate Debtor (CD), M/s. Tiffins Barytes Asbestos and Paints Ltd, entered into a Memorandum of Understanding (MoU) with the Financial Creditor (FC), M/s. Udhyaman Investments Pvt. Ltd, on 16.04.2016

Following a default, Section 7 proceedings under the IBC were initiated, and the CD was admitted into the Corporate Insolvency Resolution Process (CIRP) on 12.03.2018

A resolution plan was approved by the NCLT on 12.06.2019

The Appellant, a shareholder of the CD, challenged the plan's approval before the NCLAT and subsequently the Hon’ble Supreme Court, both of which dismissed the challenges by 06.11.2023

A further Review Petition was dismissed by the Apex Court on 13.02.2024

Despite these finalities, the Appellant filed IA(IBC)/922/CHE/2025 on 02.06.2025, seeking to declare the CIRP fraudulent and illegal

The NCLT rejected this application on 16.12.2025. The Appellant then moved the NCLAT challenging this rejection while also seeking to invoke criminal provisions under the Bharatiya Nagarik Suraksha Sanhita, 2023

1. Whether an appeal under Section 61 of the IBC is maintainable against an order where the applicant sought to compel a civil forum (NCLT) to exercise criminal jurisdiction under the Bharatiya Nagarik Suraksha Sanhita

2. Whether a shareholder has the locus standi to initiate or continue proceedings on behalf of a Corporate Debtor, particularly after a resolution plan has attained finality

3. Whether the filing of subsequent applications on grounds already adjudicated by the Appellate Tribunal and the Supreme Court constitutes an abuse of the judicial process

Sections 7, 31, 60(5), 61, and 65 of the Insolvency and Bankruptcy Code, 2016, regarding the finality of resolution plans and penalties for fraudulent initiation of proceedings

Rule 11 of the NCLT Rules, 2016, to address the inherent powers of the Tribunal and the limitations of a civil forum in performing criminal functions

The court applied the precedent established in its larger bench judgment, Park Energy Private Limited v. State Bank of India & Ors. (CA (AT) (CH) (Ins) No. 62/2023), which settled that shareholders lack locus standi to maintain such proceedings

Principles of finality of litigation and the prohibition against "de novo" reopening of settled issues were invoked

The Tribunal characterized the appeal as a "malicious recourse" and an abuse of the judicial process

It reasoned that since the MoU dated 16.04.2016 and the subsequent Resolution Plan had already been tested and affirmed by both the NCLAT and the Supreme Court, the matter had attained absolute finality

The court noted that the Appellant suppressed material facts regarding previous failed litigations and withdrawals of similar applications

Regarding jurisdiction, the court held that the NCLT, being a civil forum, cannot be forced to perform functions under penal criminal statutes like the Bharatiya Nyaya Sanhita

On the point of locus standi, the court reiterated that as a shareholder, the Appellant has no legal right to agitate causes on behalf of the Corporate Debtor once the CIRP has culminated in an implemented resolution plan

The delay of over 1.5 years after the Supreme Court's dismissal in filing the fresh IA was viewed as a "mischievous" attempt to stall the process

The court answered the issues by affirming that the resolution plan’s finality cannot be disturbed by a shareholder through repeated, concealed applications

The Tribunal imposed a cost of Rs. 5 Lakhs on the Appellant, to be deposited in the Prime Minister’s Relief Fund within two months, failing which the amount would be recovered as arrears of land revenue through asset attachment

IA No. 416/2026 for condonation of delay in refiling was allowed, while all other interlocutory applications were dismissed