Successive Section 65 applications are not maintainable once the Section 7 admission order attains finality.

The Appellant, the Suspended Managing Director of M/s. Mango Meadows Agricultural Pleasure Land Private Limited (“Corporate Debtor”), availed a loan of Rs. 8 crores from Respondent No. 2 (Kosamattam Finance Limited) in 2016.

Following defaults attributed to floods and the COVID-19 pandemic, Respondent No. 2 filed a Section 7 application under the IBC, 2016.

The Appellant unsuccessfully challenged the constitutionality of Section 7 before the Kerala High Court, which directed him to file objections before the Adjudicating Authority (“AA”) instead.

The Appellant filed an application (IA 285/2022) under Section 65 of the IBC alleging malicious initiation, which the AA dismissed on 25.01.2023 while admitting the Corporate Debtor into CIRP.

The Appellant challenged this admission via Company Appeal 88/2023, which was dismissed by the NCLAT on 13.04.2023.

Subsequently, the Appellant filed a second Section 65 application (IA 114/2024) seeking similar reliefs, which was rejected by the AA on 17.09.2025.

In the present appeal, the Appellant falsely pleaded that "no appeal" had been filed against the original admission order.

The court applied Section 65 of the IBC, 2016, which penalizes the fraudulent or malicious initiation of proceedings.

It relied on the principle of fairness and natural justice under Section 424 of the Companies Act, 2013.

The court further applied the doctrine of "clean hands" established in K.D. Sharma v. Steel Authority of India Ltd. (2008), holding that a litigant who suppresses material facts or misleads the court forfeits the right to an equitable hearing.

Additionally, it followed Vijay Syal v. State of Punjab (2003) regarding the sanctity of legal proceedings and the consequences of misrepresentation.

The Tribunal found the Appellant’s conduct "agonizing," noting that he explicitly stated in his memorandum (para 7.8) that no appeal had been filed against the 25.01.2023 order, despite having personally filed and lost Appeal No. 88/2023.

The court held that this was a deliberate attempt to mislead the Tribunal.

Regarding maintainability, the Tribunal compared IA 285/2022 and IA 114/2024 and concluded they sought the same relief.

It reasoned that once the Section 7 admission order attained finality after the dismissal of the first appeal, the issue could not be reopened through successive Section 65 applications.

The court observed that the Appellant failed to provide any evidence of fraud or malice, whereas the "debt" and "default"—the core requirements for Section 7—had already been established.

Furthermore, the Appellant’s act of submitting a Resolution Plan as a promoter while simultaneously challenging the CIRP's validity was deemed contradictory and dubious conduct.

The Tribunal ruled that the Appellant’s failure to approach the court with clean hands and the concealment of the previous appellate dismissal disentitled him from relief.

Consequently, the Tribunal upheld the AA’s order and imposed a cost of Rs. 50,000 on the Appellant for his unfair conduct and material concealment.