HC Erred in Entertaining Delayed Writ Petition Seeking to Quash CoC Minutes Approving Appellant’s Resolution Plan | SC

Case Details: Mohammed Enterprises (Tanzania) Ltd. v. Farooq Ali Khan - [2025] 170 taxmann.com 193 (SC)

Judiciary and Counsel Details

• Pamidighantam Sri Narasimha and Manoj Misra, JJ.

Facts of the Case

In the instant case, the CIRP was admitted against the corporate debtor at the instance of the financial creditor. The appellant submitted its resolution plan, which was approved by the CoC and the resettlement proposal of the respondent was rejected.

Meanwhile, the respondent, the suspended director of the corporate debtor, approached the High Court seeking the quashing of minutes of the meeting and direction to the CoC for acceptance of its proposal.

The High Court allowed the writ petition whereby the appellant’s resolution plan was set aside, primarily on the ground that the principles of natural justice were violated. Thereafter, an appeal was made before the Supreme Court.

Supreme Court Held

The Supreme Court held that since there was a delay in approaching the High Court, particularly when the respondent himself had initiated proceedings under the Code by filing interlocutory applications seeking similar relief, the High Court committed an error in entertaining a writ petition.

Further, the instant case was not a case for the High Court to interdict CIRP proceedings under the IBC. Thus, the appeals against the impugned order passed by the High Court were to be allowed.

List of Cases Reviewed

• Order passed by the High Court of Karnataka in Writ Petition No. 483 of 2023 (GM-RES) dated 22.04.2024.[Para 16]; reversed.

List of Cases Referred to

• KSK Mahanadai Power Company Limited v. UP Power Corporation Limited (para 9)
• Whirlpool Corporation v. Registrar of Trade Marks, Mumbai and Ors. (1998) 8 SCC 1 (para 10)
• Gujarat Urja Vikas Nigam Limited v. Amit Gupta (2021) 7 SCC 209 (para 13).