Executive Summary
“The commercial wisdom of the Committee of Creditors (CoC) remains the cornerstone of the Insolvency and Bankruptcy Code (IBC). This paper reviews recent appellate decisions balancing CoC primacy against statutory compliance and resolution plan viability.”
1. The Sanctity of CoC Commercial Wisdom
The Supreme Court in landmark rulings including K. Sashidhar and Essar Steel established that adjudicating authorities (NCLT/NCLAT) cannot evaluate the commercial viability of a resolution plan approved by the CoC with a 66% voting majority.
However, recent appellate jurisprudence underscores that this immunity is conditional upon strict compliance with Section 30(2) of the Code, including fair treatment of operational creditors.
2. Adjudicating Authority Oversight vs. Overreach
While NCLT cannot alter commercial terms, it retains jurisdiction to remit resolution plans back to the CoC if procedural irregularities, statutory non-compliance, or Section 29A disqualifications are identified.