Vikram Solar is facing insolvency trial under IBC.
NEW DELHI: On June 12 2026, the NCLT Kolkata Bench admitted a corporate insolvency petition against Vikram Solar Limited, suspended its board of directors and handed operational control to an Interim Resolution Professional. The petitioner was Isitva Steels Private Limited, a civil subcontractor from a 2018 solar project. The undisputed outstanding balance, acknowledged by Isitva itself in a February 2023 TDS reconciliation email, was Rs 91,98,556 that is below the Rs 1 crore minimum default threshold required to trigger the Insolvency and Bankruptcy Code.
The NCLAT Principal Bench stayed the order on June 24 after Vikram Solar deposited the undisputed amount with the Ministry of Corporate Affairs. Isitva’s counsel did not object and confirmed this would constitute full and final settlement. The board resumed control. The episode lasted twelve days. The legal architecture that enabled it remains unchanged.
The Company at the Centre
Vikram Solar is not a distressed enterprise. Its consolidated FY26 revenue was Rs 4,802 crore. Profit after tax was Rs 470 crore. Operating EBITDA was Rs 917 crore. Net long-term debt as of March 31 2026 was zero. Debt-to-equity ratio was 0.03. Market capitalisation on June 25 was Rs 6,807 crore. The company listed in August 2025 through an IPO oversubscribed 56.4 times with anchor investors including Goldman Sachs, Morgan Stanley and Kotak AMC. It employs approximately 3,500 people, holds an 8.2 GW active order book and is executing a Rs 5,050 crore capital expenditure programme to expand module capacity to 15.5 GW by FY27.
The total amount Isitva claimed was Rs 9.44 crore or 0.19 percent of Vikram Solar’s annual revenue. The undisputed amount was Rs 91.98 lakh that accounts to 0.019 percent of revenue.
Eight Years, One Disputed Email
The dispute originates from a February 2018 civil subcontract for solar works at an APGENCO project in Andhra Pradesh. Isitva completed the work in December 2018. Vikram Solar issued a performance certificate in October 2019. In December 2019 both parties signed a settlement reducing total payable dues to Rs 4.60 crore from Isitva’s initial claim of Rs 8.15 crore. Vikram Solar paid Rs 4.14 crore in staggered instalments through February 2022, leaving Rs 91.98 lakh unpaid.
In September 2022 Isitva issued a demand notice under Section 8 of the IBC claiming Rs 3.53 crore including interest. Vikram Solar paid a further Rs 70 lakh the following month. In February 2023 Isitva sent a TDS reconciliation email acknowledging the remaining ledger outstanding as Rs 91,98,556. Isitva then filed a Section 9 petition in early 2025 claiming Rs 9.44 crore adding 14 percent per annum contractual interest on top of the principal, inflating the claim more than tenfold above the acknowledged outstanding balance.
Why the NCLT Admitted It
The NCLT Kolkata Bench admitted the petition on a strict literal reading of Section 9. Because the December 2019 settlement was not fully performed and Rs 91.98 lakh remained unpaid due to which the bench held the settlement was breached, legally reviving Isitva’s original pre-settlement claim. The February 2023 TDS email acknowledging Rs 91.98 lakh as the outstanding balance was ruled a tax compliance document, not a contractual waiver of broader claims. With 14 percent interest added to the principal the total exceeded Rs 1 crore thus making admission mandatory under the code’s provisions.
The written order was made available on June 18. The board was suspended on June 19. IRP Tripti Agarwal issued a public creditor claims notice on June 21 with a July 2 deadline. The stock fell 2.6 percent to Rs 185.28 on June 22. Suspended CEO Sameer Nagpal filed an appeal on June 24. The NCLAT stayed the order the same day.
The Structural Problem
The Rs 1 crore minimum default threshold under Section 4 of the IBC was raised from Rs 1 lakh in March 2020 via MCA notification during the COVID-19 period to protect MSMEs from liquidation over minor liquidity gaps. It has not been revised since and is not indexed to the debtor’s size, turnover or financial health. A company with Rs 5,000 crore in revenue and zero debt faces the same statutory trigger as a company genuinely insolvent.
This creates a predictable vulnerability. Because NCLT benches focus on proof of default rather than balance sheet solvency, any creditor with a claim that can be argued above Rs 1 crore through interest, penalties or revival of prior claims can trigger board suspension of a listed company. For the target company the threat itself is the lever. Board suspension violates loan covenants, risks freezing commercial contracts and generates immediate market damage regardless of the underlying merit. Settling even a spurious or inflated claim, becomes commercially rational.
The reform debate among insolvency lawyers and the Insolvency Law Committee has produced three proposals: a turnover-linked proportionality threshold where default must exceed a percentage of annual revenue to trigger proceedings; a dual-tier system with a lower threshold for MSME creditors and a higher asset-indexed threshold for large corporates; and a mandatory pre-admission solvency assessment requiring the NCLT to evaluate the debtor’s balance sheet before initiating a CIRP.
None of these proposals has been legislated. The appellate safety valve that is deposit the disputed amount and get a stay, works as a case-by-case corrective. It does not address why the trigger was pulled in the first place nor does it protect companies that cannot mobilise the deposit quickly or whose board suspension causes irreversible commercial damage in the interim.
The next NCLAT hearing to confirm Vikram Solar’s compliance with the deposit directive is scheduled for June 29.
About the Author
