Published on: 17th July 2026
Authored by: Snigdho Dhar
University of Engineering and Management, Kolkata
I. Introduction
The contemporary evolution of India’s market economy has driven significant integration within corporate and commercial jurisprudence, highlighted by the operational overlap between the Insolvency and Bankruptcy Code, 2016 (IBC) and the Competition Act, 2002.[1] The IBC provides an expedited, time-bound mechanism designed to facilitate the restructuring of distressed corporate debtors and maximize asset value for creditors, investors, and employees.[1] Conversely, the Competition Act, 2002 protects market integrity by prohibiting anti-competitive practices and regulating combinations to prevent excessive market concentration.[1]
In recent years, the Corporate Insolvency Resolution Process (CIRP) has increasingly involved large-scale corporate acquisitions, where prospective resolution applicants seek to acquire distressed companies.[1] When these acquisitions clear the statutory asset or turnover thresholds, they qualify as combinations under the Competition Act, requiring mandatory clearance from the Competition Commission of India (CCI).[1] This overlap created significant uncertainty regarding the exact sequence and priority of regulatory approvals between the insolvency framework and merger control regimes.[1]
The Supreme Court of India’s landmark 2025 decision in AGI Greenpac v. Hindustan National Glass & Industries Limited resolved this confusion by establishing the legal order of approvals.[1] The Court ruled that before the Committee of Creditors (CoC) can formally vote to approve a resolution plan involving a combination, the applicant must first obtain approval from the CCI.[1] This article analyzes the statutory interplay between insolvency and competition law, evaluates the Supreme Court’s ruling, and assesses its implications for distressed mergers and acquisitions in India.[1]
II. The Statutory Frameworks
A. The Insolvency and Bankruptcy Code, 2016
The IBC was enacted to reform the historical delays and inefficiencies that characterized India’s prior insolvency regimes.[1] Under the CIRP, an independent Resolution Professional assumes management of the corporate debtor while prospective investors formulate and submit resolution plans.[1] The CoC plays a central role in evaluating and voting upon these bids.[1] Once approved by both the CoC and the National Company Law Tribunal (NCLT), the plan becomes legally binding on all stakeholders.[1] To prevent the rapid depreciation of distressed assets, the IBC enforces strict statutory timelines to ensure swift resolution.[1]
B. Merger Control Under the Competition Act, 2002
The primary objective of the Competition Act is to foster and maintain healthy, competitive market environments.[1] Sections 5 and 6 of the Act govern combinations, mandating that mergers, acquisitions, and amalgamations exceeding specific financial thresholds must be notified to the CCI.[1] Transaction parties are legally prohibited from executing a combination prior to receiving explicit clearance from the regulator.[1] The CCI evaluates whether the proposed transaction will cause, or is likely to cause, an Appreciable Adverse Effect on Competition (AAEC) within the relevant product and geographic markets.[1]
III. Factual Matrix and the AGI Greenpac Rationale
Hindustan National Glass & Industries Limited (HNG), a premier container glass manufacturer in India, entered insolvency proceedings due to severe financial distress.[1] AGI Greenpac Limited emerged as the successful resolution applicant, proposing a plan to acquire HNG.[1] Because both companies operated within the same line of business, the proposed transaction triggered horizontal market concentration concerns under the Competition Act.[1] This scenario raised a critical question: could the CoC vote to approve the resolution plan prior to, or contingent upon, the clearance of the combination by the CCI?[1] Litigious challenges to this approval sequence ultimately brought the matter before the Supreme Court.[1]
The Supreme Court clarified the statutory order, ruling that prior approval from the CCI is a mandatory prerequisite before the CoC can vote to approve a resolution plan qualifying as a combination.[1] The Court stated that insolvency proceedings do not grant immunity from broader public law obligations or regulatory compliance requirements.[1] The Court observed that the ultimate purpose of the IBC is to achieve a lawful and sustainable resolution, rather than prioritizing speed at the expense of statutory compliance.[1] Allowing the CoC to approve plans without prior CCI clearance introduces severe regulatory uncertainty and risks disrupting the final resolution if the combination is later rejected or altered by the antitrust authority.[1] Thus, the IBC and the Competition Act are complementary, ensuring that asset value maximization under insolvency law does not degrade market competitiveness.[1]
IV. Legal and Commercial Implications
The 2025 judgment introduces several critical shifts for distressed mergers and acquisitions across the Indian market:
- Strengthening Regulatory Compliance: The decision reinforces the principle that all corporate restructurings, irrespective of financial distress, must comply with state regulatory mandates, thereby ensuring legal clarity and reducing downstream litigation risks.[1]
- Preservation of Market Dynamics: By maintaining strict antitrust oversight during insolvency, the ruling prevents dominant market actors from consolidating market share by acquiring distressed competitors unchecked, thus protecting consumer choice and fair competition.[1]
- Front-Loading Legal Strategy: Resolution applicants must now integrate antitrust analysis early in their bidding strategies.[1] This front-loading requires engaging competition experts during bid formulation and initiating pre-filing consultations with the CCI, which increases upfront costs but secures transaction certainty.[1]
- Re-evaluating Investor Risk: Institutional investors and strategic bidders face increased complexity when targeting distressed assets with significant market shares, altering the valuation and feasibility of acquiring competitors out of insolvency.[1]
V. Strategic and Institutional Challenges
Despite providing essential legal clarity, the Supreme Court’s ruling introduces practical challenges for the wider insolvency ecosystem:
A. Risks of Asset Value Depreciation and Delays
The core criticism of the ruling centers on its potential to delay the resolution process.[1] The IBC’s efficacy depends on its strict statutory timelines, designed to preserve the enterprise value of the corporate debtor.[1] Adding a mandatory, multi-stage antitrust review prior to the CoC’s vote risks extending the CIRP, which can cause asset depreciation, operational losses, and reduced recovery rates for financial creditors.[1]
B. Transaction Costs and Deterred Bidding Interest
Navigating full-scale antitrust investigations involves significant legal, economic, and administrative expenditures.[1] These added transaction costs may lower the financial viability of distressed assets, reducing interest from smaller strategic investors or private equity bidders.[1] If the approval process becomes prolonged or unpredictable, potential bidders may choose to withdraw from insolvency auctions entirely, leading to liquidation rather than resolution.[1] Furthermore, this tension emphasizes the need for institutional cooperation among the Insolvency and Bankruptcy Board of India (IBBI), the NCLT, and the CCI to manage overlapping procedures smoothly.[1]
VI. Comparative Perspectives and Recommendations
Mature global jurisdictions offer proven models for balancing insolvency objectives with competition law oversight.[1] In the United States, mergers involving bankrupt or distressed entities can qualify for expedited, fast-track antitrust reviews under specific statutory exemptions, recognizing the need for speed while preserving market protections.[1] Similarly, the European Union enforces merger control rules during insolvency but provides accelerated review timelines for combinations involving failing firms to prevent liquidation and market disruption.[1]
To optimize the Indian framework, the following structural reforms are recommended:
- Establishment of a Fast-Track CCI Review Window: The CCI should introduce a dedicated, fast-track evaluation channel for combinations arising out of the CIRP, significantly reducing standard review timelines without compromising antitrust scrutiny.[1]
- Formalized Institutional Coordination: The IBBI, the NCLT, and the CCI should establish a combined regulatory protocol to facilitate information sharing and coordinate parallel procedural steps, preventing systemic friction.[1]
- Statutory Amendments: The legislature could amend the regulations to explicitly formalize the sequential flow of approvals, providing statutory clarity and eliminating residual room for conflicting interpretations.[1]
- Specialized Training for Insolvency Professionals: Educational programs should be updated to train Resolution Professionals in competition law principles, enabling early identification of potential antitrust hurdles during the bidding process.[1]
VII. Conclusion
The Supreme Court’s decision in AGI Greenpac v. HNG marks an important milestone in Indian corporate law, settling a long-standing jurisdictional debate at the intersection of insolvency and competition frameworks.[1] By clarifying that CCI approval must operate as a condition precedent to the CoC’s vote, the Court has upheld the rule of law, protected fair market competition, and brought transaction certainty to corporate restructurings.[1] While concerns regarding extended timelines and increased transaction costs persist, these challenges highlight the need for institutional refinement and administrative improvements rather than a rollback of regulatory standards.[1] Ultimately, the judgment confirms that restoring financially distressed companies and protecting market competition are complementary goals, serving together to strengthen the long-term health of the economy.[1]
Bibliography
Primary Sources
[1] AGI Greenpac Limited v. Hindustan National Glass & Industries Limited & Ors., Civil Appeal Nos. 345-347/2025 (Supreme Court of India, 2025) [Analyzing the statutory relationship between the Insolvency and Bankruptcy Code, 2016, Sections 5 & 6 of the Competition Act, 2002, and the procedural mandates governing the Committee of Creditors and the Competition Commission of India].
