The National Company Law Appellate Tribunal has rejected Zaveri Group’s resolution plan for Gujarat Hydrocarbons and Power SEZ due to significant documentation errors and unverified land assumptions. The court has ordered a complete restart of the insolvency process, requiring a new resolution professional to invite fresh bids. This ruling underscores the strict requirement for transparency and data accuracy in corporate debt resolution.
The National Company Law Appellate Tribunal (NCLAT) has set aside the approved resolution plan for Gujarat Hydrocarbons and Power SEZ Ltd (GHPSL), forcing the company’s insolvency proceedings back to the beginning. This ruling effectively invalidates the bid submitted by Zaveri Group, citing fundamental procedural flaws that compromised the integrity of the process.
The tribunal found that the resolution plan was built upon shaky foundations. Specifically, the bid relied on an unverified assumption that a large 450-hectare site in Bharuch would be de-notified from its status as a Special Economic Zone (SEZ). The NCLAT noted that this assumption lacked the necessary consent from the Gujarat Industrial Development Corporation (GIDC), which is the lessor of the land, and failed to receive the required certification from the Development Commissioner.
Beyond the land issues, the tribunal pointed to material inaccuracies within the Information Memorandum, the document provided to potential bidders detailing the company's financials and assets. These included discrepancies in claim amounts, such as overstatements related to SREI Infrastructure Finance Ltd, and misclassifications concerning the corporate guarantor, Assam Company India Ltd. Because the Information Memorandum is meant to be the primary source of truth for bidders, the tribunal ruled that these errors rendered the entire bidding process legally non-viable.
It is important for market observers to note that Gujarat Hydrocarbons and Power SEZ Ltd is a private, unlisted entity and not a company traded on public stock exchanges. While this means there is no direct impact on stock prices, the ruling is significant for insolvency practitioners, creditors, and those monitoring the corporate debt resolution sector. The decision clarifies that the GIDC, as the lessor, has the standing to challenge plans that impact its property rights. This follows a broader legal context where the Gujarat High Court had previously ruled in April 2026 that the GIDC could not initiate eviction proceedings during the insolvency moratorium.
With the original resolution plan voided, the insolvency process for the company must now effectively restart. The NCLAT has mandated the appointment of a new resolution professional who will be responsible for compiling a corrected and accurate Information Memorandum. Once this is completed, a fresh invitation for expressions of interest will be issued, allowing the bidding process to begin again under more transparent conditions.