The NCLT directed Kotak Mahindra Bank to release title deeds after confirming receipt of full payment by the corporate debtor, asserting that creditor retention of documents post-payment contravenes the resolution plan.
NCLT Directs Kotak Mahindra Bank to Release Title Deeds
The National Company Law Tribunal (NCLT) has issued a directive to Kotak Mahindra Bank to release title deeds following complete payment under the approved resolution plan. The Tribunal's decision comes in light of the principle that creditors cannot retain documents unjustifiably after dues have been settled.
This ruling emphasizes the impermissibility of creditors obstructing resolution processes once payment obligations are fulfilled. The NCLT underscored that the retention of documents post-payment is contrary to the terms of the approved resolution plan, thereby reaffirming creditor obligations in post-resolution scenarios.
For legal practitioners, this ruling highlights the need to ensure compliance with resolution plans and stresses the consequences of non-compliance, particularly regarding the handling of secured assets after entitlements are exercised.
Citations
- NCLT Order (2026) 1 NCLT 2
