A committee of creditors that has already approved a resolution plan cannot turn around and pull it back simply because the corporate debtor's books look healthier than they did at the time of approval. That is the short point the Supreme Court settled on October 26, 2026, dismissing an appeal by Bank of India and the other members of the committee of creditors of TD Toll Road Private Limited, a toll-collection company operating on National Highway 45.
TD Toll Road went into the corporate insolvency resolution process after a financial creditor's Section 7 application was admitted, with the first appellant before the Supreme Court being that very applicant. By May 2021, the committee of creditors had unanimously approved a resolution plan put forward by a consortium including S.M. Kamal Pasha, the first respondent, for a resolution amount of Rs 172.55 crore against what senior counsel for the appellants, Gopal Sankarnarayan, told the Court was an opening balance of only Rs 30 crore in the corporate debtor's accounts. The plan was then placed before the NCLT for approval, as Section 31 of the Insolvency and Bankruptcy Code requires.
What happened next is where the dispute arose. By the time the Supreme Court, in separate earlier proceedings, dismissed a special leave petition filed by the erstwhile promoter of the company, the opening balance on the corporate debtor's books had climbed to about Rs 165 crore. The committee of creditors and the resolution professional took the view that this rise handed the successful resolution applicant a windfall never contemplated when the plan was approved, and they moved the NCLT to withdraw the plan altogether. The NCLT agreed and allowed the withdrawal application. The National Company Law Appellate Tribunal took the opposite view, set aside the NCLT's order, and held that the committee of creditors had no jurisdiction to withdraw a plan it had already approved and submitted to the adjudicating authority. The committee of creditors then appealed to the Supreme Court.
The Court upheld the NCLAT and dismissed the appeal. It held that an application under Section 7, or a resolution plan built on it, can be withdrawn only up to the point the committee of creditors approves the plan. Once that plan is placed before the adjudicating authority for approval under Section 31, neither the underlying application nor the plan itself can be withdrawn, whatever has changed in the meantime. The Court traced this back to the binding effect that attaches to a resolution plan the moment the committee of creditors approves it: from that point on, the plan is binding as between the committee of creditors and the successful resolution applicant, even before the NCLT gets around to confirming it.
On the committee of creditors' central argument, that the corporate debtor's improved financial position justified a rethink, the Court was unambiguous. Improved profitability of the corporate debtor after approval is not, by itself, a ground to refuse or undo approval of a plan that otherwise satisfies the requirements of Section 30(2) of the Code. Letting creditors reopen a concluded commercial bargain every time the debtor's fortunes turn would defeat the finality the resolution process is built around, and the Code gives no such licence either to the resolution applicant or to the committee of creditors.
The Court did not shut the door entirely on the committee of creditors' underlying grievance about a windfall. Its observations on that specific question, as distinct from its holding on the binding and irrevocable nature of an approved plan, were recorded as prima facie. The Court directed the NCLT, while taking up the pending application for approval of the resolution plan, to examine the corporate debtor's present financial position and cash balance against the terms of the plan, and to decide that application together with a one-time settlement proposal that the holding company had separately placed before it.
The practical message for lenders sitting on a committee of creditors is that the window to reconsider a resolution plan closes earlier than many assume, at the point of CoC approval rather than at NCLT confirmation. A change in the corporate debtor's fortunes after that point is a matter the adjudicating authority may weigh while deciding whether to approve the plan, not a lever creditors can pull to walk away from a deal they have already struck. Resolution applicants, for their part, gain a clearer assurance that an approved plan will not be unwound through a later withdrawal application merely because the numbers moved in their favour while the plan sat before the NCLT.