NCLAT's Decision In Phoenix ARC Case: Implications For Secured Creditors' Security Interest In Liquidation

On 20 March 2025, the National Company Law Appellate Tribunal (NCLAT) delivered a judgment in the case of Phoenix ARC Private Limited vs. Kuldeep Verma, affirming the decision of the National Company Law Tribunal (NCLT) to include the Haldia property in the liquidation estate of KS Oils Limited. The bench, presided over by Justice Ashok Bhushan and Technical Member Barun Mitra, analysed the legal provisions and the conduct of the parties involved, ultimately dismissing Phoenix ARC's appeal while allowing the successful bidder, Halder Venture Limited, to proceed with the acquisition of the Haldia property.

Background of the Case

The dispute arose during the liquidation proceedings of KS Oils Limited, Phoenix ARC Private Limited, a secured creditor with a claim of ₹793.45 Crores, asserted its security interest over the Haldia property, a 12.84-acre industrial unit located in Medinipur, West Bengal. In its Form-D filed on 14 April 2021, Phoenix ARC explicitly stated