Full Text
HIGH COURT OF DELHI
Date of Decision: 17th September, 2025
NTPC LTD.
Through its Authorized Representative Mr. Rohit Salil Mukherjee
NTPC Bhawan, Scope Complex, 7, Institutional Area, Lodhi Road, New Delhi-110003 .....Petitioner
Through: Mr. Mohit Mathur Sr Adv.,
Ramanathan Advocates
Through Director of Enforcement 6th Floor, Lok Kalyan Marg, Khan Market, New Delhi-110003 ...Respondent
Through: Mr. Anupam S. Sharrma, Advocate.
JUDGMENT
1. A Petition under Section 528 of Bhartiya Nagrik Suraksha Sanhita (BNSS), 2023 has been filed on behalf of the Petitioner/NTPC Ltd. to challenge the Order dated 28.07.2025 of learned Special Judge, New Delhi in CT Case No.24/2021, directing the issuance of Notice and seeks appearance of the Petitioner/NTPC Ltd. and also quashing of all proceedings arising from the Complaint in regard to Jhabua Power Ltd. (hereinafter referred to as “JPL”).
2. JPL was incorporated in the year 1995 as a part of Avantha Group. It is a power generation Company having its operational capacity of 1*600 MW thermal power project located at Seoni (near Jabalpur), Madhya Pradesh. JPL was admitted into the Corporate Insolvency Resolution Process in C.P (IB) No.634/KB/2017 based on a Petition filed by Flsmidth Private Limited, an Operational Creditor at National Company Law Tribunal (NCLT), Kolkata Bench. Mr. Abhilash Lal was appointed as the Resolution Professional (RP) of the Corporate Debtor JPL, on 26.06.2019.
3. The Resolution Professional made a public announcement on 01.04.2019 and called for ‘proof of claims’ from the financial and operational creditors, workers and employees of the Company in specified forms, till 10.04.2019.
4. The Petitioner/NTPC Ltd. which is a Maharatna Public Sector Undertaking of Government of India, incorporated in 1975 and India’s largest energy conglomerate, in furtherance of its corporate objectives and in line with the legislative intent of Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as “IBC”) participated as a bona fide Resolution Applicant in the Corporate Insolvency Resolution Process of Jhabua Power Ltd., a distressed asset in the power sector.
5. NTPC Ltd and other bidders submitted their respective Resolution Plans for JPL, on 30.12.2019. The Revised Resolution Plan was submitted by the Petitioner for acquisition of JPL, wherein the Petitioner and the lenders were to hold 50% shareholding each in JPL in 2020-2021.
6. CBI registered FIR bearing No.RC2232021A0005 for the offences under Section 120(B)/ 406/ 420/ 468/ 471 IPC regarding the credit facility of Rs.514.27 crores as extended to Oyster Buildwell Pvt. Ltd., thereby causing wrongful loss of Rs.466.51 crores, against OBPL and others on 02.06.201. JPL was also arrayed as Accused No.21 therein. On 15.06.2021 the Respondent registered ECIR bearing No. ECIR/11/HIU/2021 against the JPL amongst other accused persons, in relation to the aforesaid FIR.
7. On 26.06.2021 pursuant to the negotiation between the Committee of Creditors and NTPC Ltd., a Plan dated 16.04.2021 was submitted by the Petitioner which was put for discussion and voting in the 16th CoC on 26.06.2021. The Resolution Plan submitted was voted in favour of the Petitioner by 100% vote of the CoC.
8. On 29.12.2021, Competition Commission of India (CCI) approved the proposed combination and acquisition of JPL by the Petitioner under the Resolution Plan. The NCLT, Kolkata Bench passed a final Order on 06.07.2022 in I.A.(IB) Noi.586/KB/2021 approving the aforesaid Resolution Plan. The Order also explicitly granted immunity from prior offences under Section 32A IBC.
9. The Financial Creditors of JPL chose to convert their NCD and equity participation into shareholding of JPL. Consequently, the structure which emerges is that after the Resolution Plan the Petitioner holds 50% shareholding and the rest of the share-holding is held by Power Finance Corporation Ltd., Union Bank of India, State Bank of India, Punjab National Bank, Axis Bank, REC Ltd. Bank of India, UCO Bank and LIC.
10. In the interim, on 09.10.2021 the Special Judge, New Delhi vide Order in CT Case No.24/2021 (ECIR No. 11/HIU/2021) took cognizance of the offences under Section 3 read with Section 70 PMLA.
11. On 04.05.2025 the Special Judge recorded that JPL was undergoing liquidation and directed ED for summoning of official liquidators or authorized representatives of JPL. Thereafter, the impugned Order dated 28.07.2025 was passed by the learned Special Judge directing issuance of Notice to NTPC Ltd. to appear on behalf of Jhabua Power Ltd. for the next date of hearing i.e. 25.08.2025. Aggrieved by the said Order, the present Petition has been filed.
12. The impugned Order is challenged on the ground that the Resolution Plan has already been approved by NCLT in favour of the Petitioner and had further directed that “All legal proceedings against the Corporate Debtor (including criminal proceedings but excluding those against the existing promoters) including by Serious Fraud Investigation Office, Enforcement Directorate, Central Bureau of Investigation or any other governmental or regulatory authority and all reference to enquiry, investigation, summon, notice or any other proceedings pertaining to seizure or attachment of the assets of the Corporate Debtor shall stand irrevocable and unconditionally withdrawn, abated, settled and extinguished in perpetuity on and with effect from the Approval Date.”
13. It is stated that while summoning the Petitioner, the learned Special has ignored the mandate of law in the case of Pepsi Foods Limited and Another vs. Special Judicial Magistrate and Others, (1998) 5 SCC 749, wherein it is held that summoning a person in Criminal cases is a serious matter and the Criminal law cannot be set into motion as a matter of course. The proceedings undertaking by the learned Special Judge is contrary to the judicially and legislatively sanctified ‘Clean Slate’ Doctrine, which is the bedrock of IBC. This doctrine ensures that a successful Resolution Applicant takes over the Corporate Debtor free from all past encumbrances. The continuation of criminal proceedings and directing the present petitioner to represent Jabua Power Ltd., is expressly and unequivocally barred by law under Section 32A IBC. Further, the Order of NCLT fortifies the immunity of the Petitioner.
14. Moreover, the present Petitioner holds shares only to the tune of 50% while the rest of 50% was owned by erstwhile lenders. Section 32A contains the non-obstante clause which gives an overriding effect over all other Statutes including the Prevention of Money Laundering Act, 2002 (PMLA). The proceedings are against the principle of finality and repose achieved through CIRP, which conclusively settled all past claims.
15. The approval of the Resolution Plan by NCLT is a judicial determination that brings to an end all liabilities of the corporate debtor that are not specifically preserved in the Plan. This includes contingent and potential liabilities, whether criminal or civil. To allow a Government Agency to re-agitate a liability that has been statutorily and judicially extinguished is to undermine the finality of the insolvency resolution process. It subjects the new Management to a form of double jeopardy, where the Company’s past has been fully adjudicated and settled by one judicial authority i.e. NCLT, only to be resurrected by learned Special Judge, thereby creating uncertainty and defeating the purpose of IBC. Prosecuting the revived Corporate Entity does not serve any objective of punishing the actual money launderers or confiscating their ill-gotten gains. Instead, it penalizes a bona fide Public Sector Undertaking that has invested in reviving a stressed asset; a result that is manifestly contrary to the spirit and intention of the IBC.
16. All the pre-conditions for the applicability of the immunity under IBC have been fulfilled, namely a Resolution Plan submitted by the Petitioner has been approved by the NCT and it had resulted in a complete change in management and control of JPL to a person, who was not a promoter, related party or a person implicated by the Investigating Agency in the commission of the alleged offence. The NCLT approved Resolution Plan is binding on all stakeholders, which expressly includes the Central Government and any statutory authority there under, such as the Respondent. Directing Petitioner to represent JPL in a criminal trial for a liability that has been statutorily extinguished is a futile, vexatious and oppressive exercise.
17. Reliance is placed on Ajay Mitra vs. State of MP and Ors., (2003) 3 SCC 11 and State of Haryana vs. Bhajan Lal, 1992 Supp(1) SCC 335.
18. It is submitted that the legislative intent behind enacting Section 32A was to remove the chilling effect on Prospective Resolutions Applicants who were deterred by the fear of being embroiled in criminal proceedings for the misdeeds of the erstwhile management. Continuation of the proceedings wherein the Petitioner has been served a Notice, constitutes a gross abuse of the process of law.
19. The Supreme Court has repeatedly held that inherent powers of the High Court under Section 482 Cr.P.C. should be exercised to prevent abuse of the process of the Court or otherwise, to secure the interest of justice. The Petitioner has no connection whatsoever with the alleged acts of erstwhile management of JPL. It has neither been involved in, abetted, or conspired with the commission of the alleged offences.
20. A prayer is, therefore, made that the Notice issued vide Order dated 28.07.2025 be set aside and the proceedings against NTPC in CT No.24/2021 be quashed.
21. Learned counsel on behalf of the State has submitted that vide impugned Order dated 28.07.2025, the Petitioner has not been summoned as an Accused on behalf of Accused No.21 JPL, but because it has been brought on record that the IBC proceedings against JPL stand concluded and the Resolution Plan submitted by NTPC has been accepted making it a 50% shareholder in JPL, the Notice has been issued to the Petitioner solely for the purpose of getting the complete facts about the existence of JPL. It is submitted that the Notice issued vide impugned Order, is not a Summoning Order and NTPC is issued a Notice to appear to explain the proceedings which have been undertaking against the JPL, and not as an accused. Submissions heard and record perused.
22. It is well established from the Order of NCLT that the Resolution Plan submitted by the Petitioner in respect of Insolvency proceedings initiated against JPL/Accused No.21, has been accepted making it a 50% shareholder of JPL. Also, the immunity under Section 32A IBC has been granted to the Petitioner. It emerges that Accused No.21 JPL had fallen into a legal debt. The Petitioner being a successful Resolution Applicant, cannot be considered as a successor of JPL. However, as has been pointed out by the learned Counsel on behalf of the State, there is no Summoning Order passed against the Petitioner, but only a Notice has been given for collecting further information.
23. In view of this, the Petition is disposed of with the directions to NTPC to appear before the learned Trial Court and bring to its notice the aforesaid facts along with the Order of NTPC and the immunity granted there under. The learned Trial Court shall consider the submissions of the NTPC and pass appropriate Orders as it deems fit, especially clarifying whether NTPC is to be arrayed as an Accused. In case, no case is made out against NTPC, then speaking reasoned Order in this regard, be made by the learned Special Judge.
24. The Petition is accordingly disposed of along with the pending Applications.
JUDGE SEPTEMBER 17, 2025 va