Prabhatam Investments Private Limited vs Mr. Rishabh Chand Lodha

IN THE MATTER OF: Prabhatam Investments Pvt. Ltd. ...Appellant Versus Rishabh Chand Lodha, RP of DMC Infrastructure Pvt. Ltd. & Ors. ...Respondents

Present: For Appellant : Ms. Mahima Ahuja, Advocate.

For Respondents : Mr. Abhishek Devgan, Advocate for RP.

Mr. Prakhar Mithal, Advocate for Applicant.

ORDER

(Hybrid Mode)

30.10.2025 : Heard counsel for the appellant.

2. This appeal has been filed against an order dated 13.08.2025 by which

order the I.A. No. 905/2025 filed by the appellant has been rejected.

Appellant filed the I.A. praying for following reliefs:

"a) Allow the present Application;

b) Pass appropriate Orders declaring the Challenge Mechanism conducted by the Respondent No. 1 on 01st February 2025 as null and void;

c) As a consequence, pass an appropriate order setting aside the outcome of the Challenge Mechanism conducted on 01st February 2025.

d) As a consequence, pass appropriate orders/directions to consider the plans submitted by the Resolution Applicants before the Challenge Mechanism as final to be voted upon by the CoC.

e) Pass an order declaring the Respondent No. 3 ineligible to submit the Resolution Plan due to providing incorrect information in violation of Regulation 39 of the CIRP Regulations, and direct for forfeiture of the refundable deposit and for penal action.

f) Pass any such order(s) / direction(s) as this Hon'ble Tribunal may deem fit in the interest of justice."

3. The appellant was Unsuccessful Resolution Applicant who has

questioned the challenge mechanism which was adopted by RP to maximise

the assets of the corporate debtor. Appellant's case is that appellant has

submitted revised resolution plan which covered the entire secured financial

debt hence there was no occasion for proceeding with any challenge

mechanism and the proceedings were required to be completed within 120

days. It is further submitted that one of the applicants has given offer of

Rs.46 crore, whereas, plan is now approved only for Rs.36 crore. Learned

counsel for the appellant submitted that entire process has been adopted to

help the shareholders.

4. We have considered the submissions of the counsel for the appellant

and perused the records.

5. The applicant is only resolution applicant who also participated in the

challenge mechanism along with other resolution applicants and after the

challenge mechanism, the resolution plan of the applicant was not approved

by the CoC and the plan of another resolution applicant has been approved

and admittedly the application for approval of the plan is pending before the

NCLT for consideration.

6. The submission of the appellant that since the revised resolution plan

given by the appellant covered the entire debts of secured financial creditor

there was no occasion to direct for challenge mechanism does not appeal to

us. It is the CoC who runs the CIRP and in event the CoC has taken the

Comp. App. (AT) (Ins.) No. 1658 of 2025 & I.A. No. 6524, 6528 of 2025 2 of 3 decision to adopt the challenge mechanism, no exception can be taken to the

said decision since the challenge mechanism is only with the object to

maximise the assets of the corporate debtor. Insofar as the submission of the

appellant that one of the resolution applicants has offered Rs.46 crore and

plan has been approved for Rs.36 crore, these are the issues which need to

be considered at the time of approval of the resolution plan and cannot be

looked into and examine in the present appeal which arises of the application

I.A.905/2025. The submission that since the debt of secured creditors have

been covered in the revised plan no further steps were required to be taken

cannot be accepted. The debts of the secured financial creditor are not the

only debt of the corporate debtor. The assets of the corporate debtor may be

of more value than the debt of secured creditor, hence on the said basis we

are not inclined to interfere with the order by which the application of the

appellant has been rejected.

Appeal is dismissed.

[Justice Ashok Bhushan] Chairperson

[Barun Mitra] Member (Technical) himanshu/nn

Comp. App. (AT) (Ins.) No. 1658 of 2025 & I.A. No. 6524, 6528 of 2025 3 of 3