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NCLAT Overturns Insolvency Order Against Vikram Solar, Providing Major Legal Relief

Vikram Solar has secured a significant legal victory after the National Company Law Appellate Tribunal (NCLAT) set aside an earlier order admitting insolvency proceedings against the company. The decision reverses the ruling of the National Company Law Tribunal (NCLT), Kolkata Bench, which had admitted an application under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016 over an operational creditor's claim.

In a regulatory filing, Vikram Solar stated that the NCLAT Principal Bench in New Delhi, through its order dated June 29, 2026, quashed the NCLT's June 12, 2026 order, which had been made available on June 18. The company said a copy of the detailed written order would be released once received. The appellate tribunal's decision effectively halts the insolvency proceedings initiated against the solar manufacturer.

The dispute originated from an insolvency petition filed by Isitva Steels Private Limited, which alleged an unpaid operational debt of approximately INR 9.44 crore, including interest. The claim relates to civil works subcontracted in 2018 for a solar engineering, procurement and construction (EPC) project in Andhra Pradesh. Vikram Solar has consistently contested the claim, maintaining that both parties had entered into a full and final settlement agreement in December 2019, making the insolvency application legally unsustainable.

Earlier in June, the NCLT had admitted the petition, triggering the Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code. The tribunal had also imposed a moratorium on the company's operations and appointed an Interim Resolution Professional (IRP) to oversee the insolvency process. Vikram Solar subsequently challenged the order before the NCLAT, which on June 24 granted interim relief by staying the insolvency proceedings after the company agreed to deposit the admitted amount of INR 91.98 lakh, without prejudice to its legal rights and claims.

The case highlights the importance of the appellate mechanism under the Insolvency and Bankruptcy Code, which allows companies to challenge insolvency admissions where disputes over operational debt or prior settlements exist. Under the IBC, applications filed by operational creditors under Section 9 are generally maintainable only when there is no genuine pre-existing dispute regarding the debt.

The NCLAT's ruling provides immediate relief to Vikram Solar by setting aside the insolvency admission and preventing the continuation of the CIRP. The outcome also underscores the judiciary's emphasis on examining contractual settlements and disputed claims before allowing insolvency proceedings to continue, a principle that remains central to the implementation of India's insolvency framework.