Ambition Mica monitoring committee seeks CIRP restart over plan breach
The Monitoring Committee of Ambition Mica Limited has filed an Interlocutory Application with the NCLT Ahmedabad Bench against Successful Resolution Applicant Devenkumar Patel for breaching the approved Resolution Plan. The applicant failed to pay the second installment of ₹6 crore by the stipulated deadline. The committee has sought directions to re-initiate the Corporate Insolvency Resolution Process (CIRP) and issue Form G to invite fresh bids.
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The Monitoring Committee of Ambition Mica Limited has approached the National Company Law Tribunal (NCLT) Ahmedabad Bench seeking the re-initiation of the Corporate Insolvency Resolution Process (CIRP) due to a breach of the approved Resolution Plan by the Successful Resolution Applicant (SRA), Devenkumar Rameshbhai Patel. The committee, chaired by erstwhile Resolution Professional Gautam Deswal, filed an Interlocutory Application (IA) under Section 74(3) of the Insolvency and Bankruptcy Code (IBC), 2016, alleging non-payment of dues amounting to ₹6 crore.
The approved Resolution Plan, sanctioned by the NCLT on October 30, 2025, required the SRA to pay a total consideration of ₹14.50 crore. The payment schedule mandated an installment of ₹6 crore to be paid by January 28, 2026. However, the SRA failed to meet this obligation. Despite the SRA requesting an extension and assuring payment by February 20, 2026, the funds were not received. Following the default, the Monitoring Committee, in its meeting held on February 26, 2026, resolved to file the present application to declare the SRA in breach of the plan.
Key Allegations and Relief Sought
The application alleges that the SRA knowingly and willfully contravened the terms of the Resolution Plan. The Monitoring Committee has urged the Adjudicating Authority to take strict action against the SRA. The specific reliefs sought include:
- Declaring that the SRA has contravened the Resolution Plan.
- Initiating proceedings for punishment under Section 74(3) of the IBC, which prescribes imprisonment and fines for such contraventions.
- Re-initiating the CIRP from the stage of issuance of Form G to invite fresh Expression of Interest (EOI).
- Extending the CIRP period by 90 days to facilitate the completion of the resolution process.
Resolution Plan Details
The Resolution Plan approved for Ambition Mica Limited involved a total payout of ₹14.50 crore to various creditors. The table below outlines the approved payment schedule:
| Amount Towards | 29-Nov-25 (30 days) | 28-Jan-26 (90 days) | 28-Apr-26 (180 Days) | Total |
|---|---|---|---|---|
| CIRP Cost | ₹50,00,000.00 | ₹50,00,000.00 | ₹1,00,00,000.00 | |
| Secured Financial Creditors (Axis Bank) | ₹1,80,00,000.00 | ₹6,00,00,000.00 | ₹6,00,00,000.00 | ₹13,80,00,000.00 |
| Unsecured Financial Creditors | ₹5,00,000.00 | ₹5,00,000.00 | ||
| Secured Operational Creditors (GVAT) | ₹9,45,845.00 | ₹9,45,845.00 | ||
| Unsecured Operational Creditors | ₹5,54,155.00 | ₹5,54,155.00 | ||
| Other Creditors (EPFO) | ₹7,958.00 | ₹7,958.00 | ||
| Total | ₹2,50,07,958.00 | ₹6,50,00,000.00 | ₹6,00,00,000.00 | ₹14,50,07,958.00 |
The failure to pay the ₹6 crore installment due on January 28, 2026, constitutes a material default, prompting the creditors to seek the cancellation of the existing plan and a restart of the resolution process to maximize the value of the corporate debtor's assets.
How will the potential re-initiation of CIRP impact the recovery prospects for secured creditors like Axis Bank compared to the original plan?
What legal precedents exist regarding the NCLT's decision to impose imprisonment versus fines under Section 74(3) for resolution plan breaches?
Will the reputational damage from this default deter potential bidders from submitting fresh Expressions of Interest during the re-initiated process?
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