NCLAT upholds HR Commercials-Crown Steels resolution plan for Mastana Foods
The NCLAT dismissed five appeals against the NCLT New Delhi's approval of the resolution plan for Mastana Foods, backed by State Bank of India as the sole lender with 100% of the vote.
Key points
- The NCLAT on 12 October 2026 dismissed five appeals and upheld the approved resolution plan for Mastana Foods Pvt Ltd.
- Per the order, the HR Commercials and Crown Steels consortium was the highest bidder at Rs 131.91 crore in an e-auction.
- The NCLAT held that tribunals cannot second-guess the commercial decision of the lenders' committee beyond the checks set in the Code.
The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, on 12 October 2026 dismissed five connected appeals against the approval of a resolution plan for Mastana Foods Pvt Ltd. The plan, submitted by a consortium of HR Commercials Private Limited and Crown Steels, had been approved by State Bank of India, the company's only lender on the committee of creditors with 100% of the vote, and then by the National Company Law Tribunal (NCLT), New Delhi.
What Happened
Per the order, the company was admitted into the corporate insolvency resolution process on 18 September 2019 on an application by State Bank of India. Its fair value was assessed at about Rs 70.17 crore and its liquidation value at about Rs 48.95 crore. After several rounds of bidding, including a fourth invitation for bids in December 2024, eight bidders took part in an online e-auction on 15 April 2025, where the consortium emerged as the highest bidder at Rs 131.91 crore.
The lenders' committee approved the consortium's revised plan on 15 July 2025, and the consortium deposited a performance guarantee of Rs 8 crore on 16 July 2025. The NCLT approved the plan in 2026 and rejected objections.
The appeals were filed by Amba Grains Pvt Ltd and others, a suspended director who is a guarantor of the company, and a rival bidder who is also a suspended director and personal guarantor. They argued that the resolution professional and the lenders' committee committed material irregularities, including placing a non-compliant plan before the committee.
The NCLAT, relying on Supreme Court rulings, held that neither it nor the NCLT can sit in appeal over a plan approved by the lenders' committee in its commercial wisdom, and that their role is limited to checking compliance with the Code. It found no ground to interfere.
What It Means
With the appeals dismissed, the NCLT's approval of the consortium's plan for Mastana Foods stands. The ruling again shows that once the lenders approve a plan that meets the Code's requirements, challenges by unsuccessful bidders or former promoters face narrow review. The NCLAT's order may be appealed to the Supreme Court.
Source: NCLAT order
Sources & Citations
- NCLAT order — National Company Law Appellate Tribunal