Supreme Court Cautions Unsuccessful IBC Bidders Against Strategic Litigation for Second Chance
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SC warns against 'strategic litigation' by losing IBC bidders, upholds Sarda Energy plan
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CNBC TV18•05-03-2026, 15:09
SC warns against 'strategic litigation' by losing IBC bidders, upholds Sarda Energy plan
•Supreme Court warns against "strategic litigation" by unsuccessful bidders under IBC, calling it an attempt for a "second shot" at stressed assets.
•Court stated that delays and expansive judicial scrutiny of CoC decisions destroy value, lengthen timelines, and raise transaction costs.
•Cautioned NCLT and NCLAT against wide judicial review, emphasizing the primacy of CoC's commercial wisdom.
•Reiterated that IBC confines judicial review to strict statutory compliance, leaving no scope for courts to intervene in CoC's commercial decisions.
•Observations came while upholding Sarda Energy and Minerals Ltd.'s ₹1,950-crore resolution plan for SKS Power, dismissing challenges from Torrent Power, Jindal Power, and Vantage Point Asset Management.
