The NCLAT Chennai bench has referred the issue of forfeiture of Rs 150 crore deposited by Raghava Square in the IVRCL acquisition case to the tribunal chairperson after a split verdict.
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The Chennai bench of the insolvency appellate tribunal NCLAT on Monday referred to the NCLAT chairperson the forfeiture of Rs 150 crore deposited by Raghava Square to acquire IVRCL Ltd following a split opinion between the two members of the bench.Raghava Square had submitted a bid amount for acquiring IVRCL Ltd as a going concern in the third e-auction at Rs 1,200 crore. It had deposited only Rs 150 crore.The NCLAT bench referred the matter following a split verdict between the two-member bench on whether the forfeiture of Rs 150 crore deposited by Raghava Square was justified.Tribunal upholds bid rejection over non-paymentHowever, the National Company Law Appellate Tribunal (NCLAT) upheld the rejection of the bid of Raghava Square as valid, given the failure to complete payment and the unresolved differences regarding treatment of third-party assets.Passing a common order over the four petitions filed by Raghava Square, NCLAT upheld the order passed by NCLT, which had declined to set aside the liquidator’s letter dated July 28, 2023 cancelling the bid of Raghava Square over non-payment of the balance Rs 1,050 crore.IVRCL, a Hyderabad-based engineering, procurement and construction (EPC) company, is going through liquidation after it failed to attract a buyer within the specified timeline under the Insolvency & Bankruptcy Code.Dispute over subsidiary assets and liquidation scopeA dispute has arisen over the control of the assets of the subsidiaries of IVRCL. NCLT held that it had never approved the business plan, but only the sale of IVRCL as a going concern and the payment schedule. It further held that subsidiary assets were third-party assets and could not form part of the liquidation.Passing the order, NCLAT upheld cancellation of the bid by the liquidator, given the failure to complete payment and unresolved differences regarding treatment of third-party assets. However, the two member bench differed on the forfeiture of Rs 150 crore.Split verdict triggers reference to NCLAT chairperson“As there happens to be a difference of opinion only with regard to the issue of forfeiture of a sum of Rs 150 crore deposited by the appellant, on that exclusive issue itself as to whether forfeiture could be done or not, let the matter be placed before the Chairperson, NCLAT, for an appropriate nomination, to answer the said question about justification of forfeiture,” said a 117-page-long NCLAT order.The tribunal said the reference is limited solely to the question of whether the forfeiture of the Rs 150 crore deposit was legally sustainable, as there was a divergence of views between the members on that aspect.IVRCL remains among long-pending insolvency casesIVRCL is one of the oldest insolvency matters, which belongs to the second list of RBI, which had in August 2017, directed banks to initiate insolvency proceedings to clean up their balance sheets.Published on June 9, 2026
