NCLAT Says RP Can Reverse Provisional Claim Admission After Verification; Somani Worsted Appeal Dismissed

The National Company Law Appellate Tribunal has held that a Resolution Professional can revisit and reject a provisionally admitted claim during verification where the claimant ultimately fails to establish an independent, legally enforceable financial debt. In Somani Worsted Limited v. Amit Aggarwal, Resolution Professional of Celebration City Projects Private Limited, decided on September 1, 2026, the NCLAT dismissed the creditor's appeal and upheld the NCLT's October 8, 2025 order.

The ruling is important for insolvency professionals, creditors and forensic-finance teams because it draws a careful line between two propositions: an RP does not exercise adjudicatory powers like a court, but an RP is still required to verify claims and keep the list of creditors updated under the CIRP Regulations. A provisional admission does not freeze a claim permanently if later verification shows that the debt itself has not been proved.

How the ₹9.77 crore claim arose

Somani Worsted had originally paid ₹13.60 crore to AEZ Infratech Private Limited under a January 8, 2010 memorandum of understanding for booking commercial space. Later, through inter-corporate communications and an October 7, 2010 MoU, Somani asserted that ₹9.77 crore of that amount was invested in a project of Celebration City Projects Private Limited for provisional allotment of 50,000 square feet of commercial space in the project later known as RED Mall.

When Celebration City Projects entered CIRP on March 21, 2022, Somani filed a claim as a financial creditor in a class. Its claim was initially admitted on a provisional basis and it was included in the list of creditors. The later dispute arose when the RP revisited the material, rejected the claim and removed Somani from the creditor list and Committee of Creditors participation.

NCLAT focused first on whether a financial debt existed

The Appellant argued that once the claim had been admitted, the RP had no power to review or adjudicate it. The NCLAT, however, treated that argument as secondary to the foundational question: had Somani established an independent financial debt against the Corporate Debtor within Section 5(8) of the IBC?

The Tribunal examined the transaction history, common management links among the relevant entities, the MoUs, inter-corporate memos, ledger entries and balance-sheet references. It noted that the original ₹13.60 crore payment had been made to AEZ, not directly to Celebration City Projects. It also found no bank statement, RTGS advice or other banking record showing a transfer by Somani to the Corporate Debtor.

The NCLAT said common management does not by itself invalidate a transaction. But where the principal evidence comprises internal records generated between entities under common control, the material requires closer scrutiny. In this case, the Tribunal was not persuaded that journal entries and book adjustments, without an adequate independent banking trail and enforceable obligation, established the claimed financial debt.

Earlier arbitration conduct also mattered

The Tribunal also considered Somani's earlier conduct. Somani had pursued arbitration and later execution proceedings against AEZ in relation to the transaction, while Celebration City Projects was not made a party to those proceedings. The NCLAT observed that Somani had not sought possession, specific performance or refund from the Corporate Debtor on the asserted allotment arrangement.

The decision does not create a general rule that a creditor can never pursue multiple remedies. Rather, the NCLAT distinguished that issue from the more basic requirement of proving a separate debt against the company in CIRP. Because an independent financial debt against Celebration City Projects was not established on the evidence before it, arguments about election of remedies or double recovery did not rescue the claim.

Why the RP's action was treated as verification, not adjudication

The Appellant relied on precedents stating that a Resolution Professional cannot adjudicate disputed rights. The NCLAT accepted that general principle but held that it did not decide this case. The Tribunal said the RP had not exercised a judicial power to determine competing legal rights; instead, he had performed the statutory task of verification and updation of claims.

The judgment specifically refers to Regulation 13 of the CIRP Regulations, which requires the IRP or RP to verify claims and maintain and update the list of creditors. Once the later verification showed that the claimant had not established an independent financial debt, the RP was justified in revisiting the earlier provisional admission.

Appeal dismissed

The NCLAT ultimately recorded that the original payment was to AEZ, independent transfer evidence to the Corporate Debtor was lacking, the documents relied upon were largely internal records among commonly managed entities, and Somani's own enforcement conduct had focused on AEZ. It therefore found no infirmity in the NCLT order and dismissed Company Appeal (AT) (Ins.) No. 150 of 2026. Pending applications were disposed of and there was no order as to costs.

Practical implications for insolvency and finance professionals

- Provisional admission is not final proof: creditors should assume that supporting evidence can be re-tested as the RP verifies and updates claims.

- Banking trail matters: ledger entries and related-party accounting records may be insufficient where actual disbursement and the independent legal obligation are disputed.

- Related-party documentation needs extra discipline: common directors, common addresses and inter-company adjustments can increase the need for independent evidence.

- Claim strategy should be consistent: earlier arbitration, litigation and recovery positions can be examined when a creditor later asserts a separate debt in CIRP.

- RPs must stay within verification: the decision should not be read as giving RPs general adjudicatory powers; its reasoning turns on verification of whether the claimed debt was established on the record.

For Chartered Accountants acting as insolvency professionals, advisers or claim reviewers, the key lesson is evidentiary. A creditor's accounting records may support a claim, but they do not replace proof of the underlying transaction and enforceable debt. The NCLAT's current case listing can be checked on the official NCLAT website; the exact judgment text should be read alongside the CIRP Regulations before applying the ruling to another case.

Key takeaway

Fresh NCLAT judgment gives practical guidance on provisional claim admission, evidentiary verification and the boundary between an RP's statutory verification function and adjudication.