CJI Surya Kant in a recent hearing in EAS Sarma v. Union of India and others [W.P.(C) No. 1217/2025]
By INSOL India - Communication Committee Posted On : April 21, 2026
CJI Surya Kant in a recent hearing in EAS Sarma v. Union of India and others [W.P.(C) No. 1217/2025], flagged serious concerns over the misuse of the IBC, noting that insolvency processes are being manipulated to enable pre-planned auctions and undervaluation of assets.
The CJI commented that companies are allegedly deliberately undervaluing assets and routing sales to related parties, including family members or close associates, through orchestrated bidding processes. The CJI noted instances where companies with massive outstanding dues were resolved for negligible amounts, raising concerns of collusion and systemic abuse. He acknowledged that such misuse appears to be recurring in insolvency cases, with concerns over lack of genuine valuation and transparency. The Solicitor General also stated that the government is actively examining the issue, indicating possible regulatory intervention.
The CJI commented that companies are allegedly deliberately undervaluing assets and routing sales to related parties, including family members or close associates, through orchestrated bidding processes. The CJI noted instances where companies with massive outstanding dues were resolved for negligible amounts, raising concerns of collusion and systemic abuse. He acknowledged that such misuse appears to be recurring in insolvency cases, with concerns over lack of genuine valuation and transparency. The Solicitor General also stated that the government is actively examining the issue, indicating possible regulatory intervention.