On 18th February, 2026, the Hon’ble Supreme Court of India gave a judgment in Power Trust (Promoter of Hiranmaye Energy Ltd.) vs. Bhuvan Madan (Interim Resolution Professional of Hiranmaye Energy Ltd.) & Ors.. The appeal was filed by Power Trust wherein the NCLAT order that upheld the initiation of the Corporate Insolvency Resolution Process (CIRP) against the company was challenged. The case focused on whether a debt restructuring proposal could shift the date of default to fall within the protected window of Section 10A of the Insolvency and Bankruptcy Code (IBC), which suspended insolvency filings during the COVID-19 pandemic.
The dispute arose after REC Ltd. (the financial creditor) filed a Section 7 application following the Corporate Debtor’s default on loans of Rs. 21,83,19,16,896. The Appellant argued that two restructuring proposals from 2020 had renewed the original loan agreement, moving the repayment start date into the Section 10A period (25th March, 2020, to 24th March, 2021). However, the Hon’ble Court found that these proposals never became binding because the Corporate Debtor failed to meet vital pre-implementation conditions, such as obtaining a favorable tariff order, creating a DSRA, demonstrating the power plant’s continuous operation and making available of the priority debt and working capital.
The three-Judge Bench of Chief Justice Surya Kant, Justice Joymalya Bagchi, and Justice Vipul M. Pancholi, clarified that the commercial wisdom of the CoC is non-justiciable. Despite the Appellant submitting five separate settlement proposals, the CoC repeatedly rejected them in favor of a resolution plan by Damodar Valley Corporation (DVC). The Hon’ble Court emphasized that a promoter cannot use Section 12A settlement offers to indefinitely stall the resolution process once a resolution plan has already been approved by an overwhelming majority of lenders.
In the end, the Hon’ble Supreme Court dismissed the appeal and vacated the stay on the CIRP. It also rejected SEFL’s request to claim a ₹125 crore deposit made by the appellant during the case, ordering the money to be refunded to the Appellant. The judgment reinforces that the IBC is a time-sensitive process designed to prevent corporate collapse, and that claims about business viability cannot outweigh the fact of financial default.