Suspended Director Who Is A Prospective Resolution Applicant Not Entitled To Valuation Reports : NCLT Mumbai

The National Company Law Tribunal (NCLT) at Mumbai has dismissed a challenge by a suspended director seeking disclosure of valuation reports and other Corporate Insolvency Resolution Process (CIRP) documents. The court held that valuation reports are confidential and cannot be shared with persons who are themselves potential or competing resolution applicants. “Valuation reports are confidential documents, and disclosure to persons who are themselves potential resolution applicants would undermine the sanctity of the process and is contrary to settled legal principles.”, the tribunal observed. A coram of Judicial Member Mohan Prasad Tiwari and Technical Member Charanjeet Singh Gulati rejected an application filed by Abhay Narhar Kadam, suspended director of Megi Agro Chem Limited. He had questioned the conduct of the insolvency proceedings and sought deferment of the hearing on approval of a resolution plan submitted by Arainfra Projects Private Limited. The application arose from the CIRP initiated against Megi Agro Chem Limited in August 2022 on a petition filed by Pridhvi Asset Reconstruction and Securitisation Company Ltd, the sole member of the Committee of Creditors (CoC). Kadam alleged that the resolution professional failed to share valuation reports, the resolution plan, and minutes of CoC meetings with suspended directors, which undermined transparency and violating the insolvency law. Rejecting the arguments relating to valuation reports, the tribunal held that such reports are confidential and meant exclusively for the commercial decision making of the CoC. It observed that disclosure of valuation reports to persons who are themselves prospective or competing resolution applicants would compromise the sanctity and integrity of the resolution process. The tribunal noted that the applicant and persons connected with the erstwhile management had either submitted or sought to submit resolution plans during the insolvency. In such circumstances, furnishing valuation reports or sensitive commercial information would give an unfair advantage and defeat the objective of value maximisation under the Code. Finding no violation of provisions of the Code, the NCLT dismissed the application. It said the applicant had failed to establish any ground warranting interference with the approved plan. Case Title: Abhay Narhar Kadam vs Vakati Balasubramanyam Reddy Citation: 2026 LLBiz NCLT (MUM) 29 Case Number: IA (IBC) NO. 3078 OF 2025 IN CP (IB) NO. 144/MB/2021 For Applicant: Advocate Smit Shah For Respondents: Advocates Pulkitesh Dutt Tiwari, A. Abhiraj Ray, Shivesh Kaushik Click Here To Read/Download Order

Suspended Director Who Is A Prospective Resolution Applicant Not Entitled To Valuation Reports : NCLT Mumbai

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