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Bank of India & Ors. v. S.M. Kamal Pasha & Ors.

Civil Appeal · 2026 INSC 1154Decided 26 Oct 2026
Civil Appeal No. 12045 of 2026
Justice J.B. Pardiwala · Justice K. Vinod Chandran

Background

Creditors had approved a Resolution Plan for a toll-collection company hit hard by COVID-19. Litigation delays pushed confirmation back years, during which the company's finances recovered sharply. The creditors then tried to withdraw their own approval, arguing the winning bidder would get a windfall, while former promoters separately sought a one-time cash settlement instead.

Decision Breakdown

The Supreme Court upheld the appellate tribunal's ruling that creditors cannot unilaterally withdraw an already-approved Resolution Plan merely because the debtor's fortunes later improved: once approved and placed before the Tribunal, the plan becomes binding under the IBC's statutory framework, not ordinary contract law, and the withdrawal route applies only before approval, not after. The Court left it to the Tribunal to decide both the winning bidder's confirmation request and the promoters' competing settlement application on the merits.

Lesson Learnt

Once creditors formally approve a rescue plan and it moves to the tribunal for confirmation, that approval is binding and cannot be reversed just because the company's position later improves: predictability for the winning bidder is treated as essential to the insolvency process's credibility.

Official source (sci.gov.in)View Judgment (PDF)

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