In the matter of Orbis Trusteeship Services Pvt. Ltd. vs. Gurinder Singh Sikka,
- CitationIB-130(PB)/2022
Ratio decidendi
The rule this decision rests on
The Tribunal's reasoning rests on the following principles, in the order the order takes them: Where a personal guarantor has not offered a repayment plan within the period stipulated under Section 106(1) of the Insolvency and Bankruptcy Code, 2016, and the Resolution Professional reports that no such plan has been received, the Adjudicating Authority is bound under Section 106(1A) to terminate the insolvency resolution process of the debtor, and the process is closed on that footing. Upon termination of the insolvency resolution process under Section 106(1A), the creditors are at liberty to proceed under Section 115(2) read with Sections 121 and 123 of the Code, and nothing precludes the debtor and creditor from settling before an application for initiation of bankruptcy is filed. Proceedings before the Tribunal may not be kept pending on account of the inaction of the parties or the Resolution Professional; where the statutory timelines for a repayment plan and the Resolution Professional's report have lapsed, the Tribunal is entitled to dispose of the application and close the process rather than defer it indefinitely.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
Hearing Through: VC and Physical (Hybrid) Mode ORAL ORDER On 13.06.2025 this Tribunal passed the following order :- (IB)-130(PB)/2022 Orbis Trusteeship Services Pvt Ltd. vs. Gurinder Singh Sikka (IB)-130(PB)/2022 Orbis Trusteeship Services Pvt Ltd. vs. Gurinder Singh Sikka
2. Subsequently RA-80/ND/2025 was preferred. On 17.09.2025 we passed the following order in the RA:- “New RA-80/ND/2025 Issue notice to the Respondent returnable on 06.10.2025. The Applicant undertakes to serve notice upon the Respondent through all modes viz. registered post, speed post, courier service and E-mail. Affidavit of service be filed within one week. Reply, if any, may be filed by the Respondent within one week from the date of receipt of the notice. Rejoinder, if any, may be filed before the next date of hearing. List the matter on 06.10.2025.”
3. On 06.10.2025 the Counsels for the parties submitted that the settlement between the Financial Creditor, Personal Debtor and the Personal Guarantor i.e. respondents in the present application are in progress. Having submitted so, they prayed for an adjournment. At their request the hearing was deferred to 24.11.2025. The order dated 06.10.2025 reads thus: - “RA-80/ND/2025: Ld. Counsels for the parties submitted that the settlement between the Financial Creditor, Principal Debtor and the Personal Guarantor i.e.
(IB)-130(PB)/2022 Orbis Trusteeship Services Pvt Ltd. vs. Gurinder Singh Sikka
Respondent in the present application are in progress. Having submitted so, they prayed for an adjournment. At their request, the hearing is deferred to 24.11.2025.”
4. On 24.11.2025 Ld. Counsel for the Corporate Debtor submitted that settlement would be implemented within two weeks from the date. The order passed on 24.11.2025 reads thus: “RA-80/ND/2025: The RA has been preferred for restoration of CP(IB)- 130(PB)/2022. Ld. Counsel for the Corporate Debtor submitted that the settlement would be implemented within two weeks from today. At his request, the hearing is deferred to 10.12.2025.”
5. Subsequently on 10.12.2025, 18.12.2025, 19.12.2025, 07.01.2026, 29.01.2026, 18.02.2026 and 19.03.2026 the hearing could be deferred on account of the infrastructure related issues and due to paucity of time. 6. In view of the order dated 20.04.2026 this Tribunal restored the IB- 130/PB/2022, as the settlement between the Creditor and the Personal Debtor had failed. The order dated 20.04.2026 reads thus:
(IB)-130(PB)/2022 Orbis Trusteeship Services Pvt Ltd. vs. Gurinder Singh Sikka
7. Thereafter again on 22.05.2026 and 10.06.2026 the hearing could be deferred due to paucity of time. 8. Once the proceedings are restored in terms of the order dated 20.04.2026, we are unable to appreciate that how and why for almost three months thereafter, the Resolution Professional could not file his report either under Section 106 or Section 112 of the Code. 9. Today, Mr. Hemant Sethi, Resolution Professional who is present along with Mr. Naman Singh Bagga, Advocate submitted that although the claims had been collated but the Personal Guarantor, Mr. Gurinder Singh Sikka has not offered any repayment plan. Once no repayment plan has been offered, though Resolution Professional was expected to file a report under Section 106(1A) of IBC, 2016, incorporated by way of Insolvency and Bankruptcy Code (Amendment) Act, 2026 but no such steps have been taken. 10. In any case, once the Resolution Professional who is present with his Counsel make a categorical statement that no repayment plan has been (IB)-130(PB)/2022 Orbis Trusteeship Services Pvt Ltd. vs. Gurinder Singh Sikka received, we have no option but to pass an order under Section 106(1a) of IBC, 2016 incorporate by way of amendment (ibid). Section 106 (1A) of the Code reads thus: “Section 106: Report of resolution professional on repayment plan. (1A) Where no repayment plan is submitted within the period stipulated under sub-section (1), the resolution professional shall submit a report to the Adjudicating Authority, and the Adjudicating Authority shall pass an order terminating the insolvency resolution process of the debtor and the debtor or the creditors shall be entitled to file an application for bankruptcy under Chapter IV.”
11. In the wake, the process is closed and liberty is granted to the Creditors to resort to the process under Section 115(2) read with Section 121 and Section 123 of the Code. It is made clear that there is nothing to prevent the Debtor and the Creditor to arrive at a settlement before filing application for initiation of bankruptcy process. Besides, Section 142 of the Code provides that where both the bankruptcy debts and the expenses of bankruptcy are paid after making bankruptcy order, this Tribunal can recall the bankruptcy order. The law envisages sufficient leverage and leniency in favor of the settlement between the parties.
(IB)-130(PB)/2022 Orbis Trusteeship Services Pvt Ltd. vs. Gurinder Singh Sikka
12. Thus, the process cannot be delayed on account of in action of the parties including the Resolution Professional, to keep the proceedings in the docket of this Tribunal. In the wake, the present application is disposed of.
Sd/- Sd/- (BANWARI LAL MEENA) (ASHOK KUMAR BHARDWAJ) MEMBER (T) MEMBER (J)
Iqraa/Esha (IB)-130(PB)/2022 Orbis Trusteeship Services Pvt Ltd. vs. Gurinder Singh Sikka
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