– On 12th March 2025 Delhi HC notes IBBI’s clarification on RP’s continued role despite suspension
– Following this clarification, Workers’ Union of HNGIL withdrew the petition and HC dismissed intervention applications filed by AGI Greenpac
– This brings INSCO closer to acquiring HNGIL as CoC is now in a position to proceed with the resolution process and crucial meetings of 4th and 10th Feb are restored
BACKGROUND:
– The Delhi High Court order dated 12th March 2025 has provided crucial clarity in the ongoing insolvency proceedings of Hindustan National Glass & Industries Ltd. (HNGIL) by recording the Insolvency and Bankruptcy Board of India’s (IBBI) statement that the suspension of the Resolution Professional’s (RP) Authorization for Assignment (AFA) does not bar him from “continuing with ongoing assignments”.
– This effectively removes legal uncertainty and enables the Committee of Creditors (CoC) to proceed with the implementation of the Independent Sugar Corporation’s (INSCO) resolution plan, which was recognized as the successful bid following a Supreme Court ruling in January 2025.
– HNGIL, India’s largest container glass manufacturer, entered the corporate insolvency process in October 2021, attracting competing bids from two key players, AGI Greenpac (NSE: AGI) with a market cap ₹4,700 crores and Independent Sugar Corporation (INSCO), a global industrial group with extensive experience in glass manufacturing.
– The National Company Law Appellate Tribunal (NCLAT) initially upheld the AGI Greenpac-led resolution plan in September 2023, but this approval was challenged by INSCO before the Supreme Court of India. INSCO argued that AGI Greenpac’s plan had been approved by the CoC without obtaining the mandatory prior approval from the Competition Commission of India (CCI), as required under Section 31(4) of the Insolvency and Bankruptcy Code (IBC).
– In a landmark verdict on January 29, 2025, the Supreme Court quashed AGI Greenpac’s resolution plan for failing to meet regulatory requirements. It also reversed the NCLAT order that had upheld AGI’s plan and directed the CoC to reconsider resolution plans, ensuring full compliance with competition law. This ruling nullified all actions taken under AGI’s resolution plan and reinstated the status of all stakeholders to pre-October 28, 2022, when the CoC had first approved AGI’s bid. This effectively revived INSCO’s resolution plan, making it the leading contender for acquiring HNGIL.
– Just a day after the Supreme Court’s ruling, the IBBI on January 30, 2025, initiated disciplinary proceedings against Resolution Professional (RP) Girish Sriram Juneja and suspended his Authorization for Assignment (AFA). This development led to a series of legal challenges, with AGI Greenpac and former HNGIL promoters led by Sanjay Somany filing petitions at NCLT Kolkata, arguing that the RP, under suspension, could not convene critical CoC meetings on February 4 and February 10, 2025—meetings that ultimately led to INSCO being declared the successful resolution applicant.
– In response, the Workers’ Union of HNGIL approached the Delhi High Court to seek clarity on whether the RP’s suspension affected his authority to oversee ongoing insolvency proceedings. Given the stakes involved—financial creditors, operational creditors, and over 5,000 workers dependent on a speedy resolution—the union urged the court to settle this issue swiftly. On March 12, 2025, the Delhi High Court recorded IBBI’s clarification, stating that while the RP’s AFA suspension prevents him from taking on new assignments, it does not restrict him from managing existing ones. The Court cited the Bombay High Court ruling in Kairav Anil Trivedi vs. IBBI & Ors., which supported this interpretation of the law.
– The RP had acted within the legal framework in conducting CoC meetings, seeking CIRP extensions, and submitting INSCO’s resolution plan. Following this clarification, the petition was withdrawn, and intervention applications filed by AGI Greenpac and other opposing parties were dismissed.
– INSCO stated that with legal clarity, CIRP will progress smoothly, benefiting creditors, workers, and stakeholders. Mr. Shrai Madhvani, Director of Madhvani Group of Companies said, “We are committed to a smooth, transparent resolution process and have assured creditors and regulators that we are prepared to revitalize HNGIL’s operations and ensure long-term stability for the business. Given India’s growing demand for sustainable glass packaging solutions, the successful resolution of this case could mark a turning point for the broader glass manufacturing sector.”
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Regards,
Himanshi Aggarwal
