Successful bidders in "as is where is" auctions cannot seek post-sale concessions beyond original tender terms.

In brief

The question

1. Whether the application filed by the Liquidator for reliefs and concessions was maintainable given the Appellant’s prior unconditional withdrawal of a similar application.

The court held

The NCLAT dismissed the appeal and upheld the NCLT’s order

It also directed

The court held that the application was barred by constructive res judicata and that the requested clarifications and concessions would violate the "as is where is" terms of the commercial transaction

The Tribunal concluded that the Liquidator's application was barred by law, equity, and fair play, especially as the completion of sale cannot be declared while challenges to the auction's confirmation are sub judice

All pending interlocutory applications were closed

01Facts

The Appellant was the successful bidder in the e-auction of the Corporate Debtor (CD), M/s. Veda Biofuel Limited, sold as a going concern on 16.09.2024

p. 1

The sale was conducted on an "as is where is," "as is what is," and "no recourse" basis as per the sale notice dated 21.08.2024

p. 3, 6

The Appellant initially filed IA No. 414/2024 seeking certain reliefs and concessions but withdrew the application unconditionally on 08.11.2024 without seeking liberty to refile

p. 7

Subsequently, the Liquidator (Respondent) filed IA No. 41/2025 under Section 35 and 60(5) of the IBC to report the completion of the sale and requested 41 specific reliefs and concessions for the Appellant

pp. 2-5

The National Company Law Tribunal (NCLT), Amaravati Bench, rejected the application on 03.07.2025, holding that it would not grant concessions beyond the bid document and noting that several other applications challenging the auction sale were still pending

p. 4, 5

02Issues

i.1. Whether the application filed by the Liquidator for reliefs and concessions was maintainable given the Appellant’s prior unconditional withdrawal of a similar application.

pp. 7 / para 10-11

ii.2. Whether a successful bidder in a liquidation sale conducted on an "as is where is" basis is entitled to additional judicial concessions and reliefs not provided in the original process document.

pp. 8-9 / para 11-13

iii.3. Whether the sale can be recorded as completed while interlocutory applications challenging the auction are pending adjudication.

pp. 12 / para 16-17

03Law Applied

The court applied the Insolvency and Bankruptcy Code, 2016, specifically Section 35 regarding the Liquidator's powers and Section 60(5) regarding the Tribunal's jurisdiction

p. 2

It further relied on Regulations 32A and 33 of the IBBI (Liquidation Process) Regulations, 2016, governing sales as a going concern

pp. 2-3

The court invoked the legal doctrine of Caveat Emptor (buyer beware) and the principle of Constructive Res Judicata

p. 10, 12

Furthermore, it applied Sections 3 and 55(1)(a) of the Transfer of Property Act, 1882, regarding the buyer's duty of due diligence

p. 11

The court relied on the Supreme Court precedent in KC Ninaan v. Kerala State Electricity Board & Others, which established that an "as is where is" clause puts the purchaser on notice regarding all statutory dues and liabilities

pp. 9-10

Provisions in the judgment · 5 · Linked ones open on LawLens

Insolvency and Bankruptcy Code, 2016. Section 35 Section 60 Section 61

Transfer of Property Act, 1882 Section 3 Section 55

04Reasoning

The Tribunal reasoned that because the Appellant withdrew its earlier application for similar reliefs (IA 414/2024) unconditionally, it was procedurally barred from seeking the same through the Liquidator

pp. 7-8

The court noted that the Liquidator cannot "further the cause" of the successful bidder for concessions that were already effectively denied by the withdrawal of the bidder's own application

p. 8, 12

Regarding the nature of the sale, the Tribunal found that by participating in the bid, the Appellant accepted the "as is where is" terms, creating a deeming presumption of knowledge of all liabilities

p. 7, 9

Applying KC Ninaan, the court held that the seller is not obligated to disclose patent defects or liabilities that a prudent purchaser could discover through due diligence

pp. 10-11

Finally, the Tribunal held that recording the sale as "complete" would be premature and prejudicial while other applications challenging the validity of the auction itself (IA Nos. 351, 330, and 327 of 2024) remained pending

p. 12