Promoter's Section 12A settlement proposal rejected by Canara Bank; CIRP to continue

The company is under Corporate Insolvency Resolution Process (CIRP) since the NCLT Mumbai order of March 11, 2024.

Fri 25 Sep 2026

NCLT Order Date

March 11, 2024

Settlement Proposal Date

September 23, 2026

Bank Rejection Date

September 24, 2026

Resolution Professional

Mr. Bimal Kumar Agarwal (appointed August 13, 2026)

Creditor Status

Canara Bank - sole secured financial creditor with 100% voting share in CoC

What is happening

Vas Infrastructure Limited is undergoing a Corporate Insolvency Resolution Process (CIRP) following the order dated March 11, 2024 of the NCLT, Mumbai Bench in C.P. (IB) No. 314/MB/2023. By an order dated August 13, 2026 (uploaded on the NCLT website on August 24, 2026), Mr. Bimal Kumar Agarwal was appointed as the Resolution Professional.

The creditor

Canara Bank Limited is the sole secured financial creditor, holding 100% of the voting share in the Committee of Creditors. This means the bank alone decides on creditor matters.

The rejected proposal

• Promoter Mr. Jayesh Valia submitted a proposal dated September 23, 2026 directly to the bank.
• The proposal sought settlement of dues and withdrawal of the CIRP under Section 12A of the IBC read with Regulation 30A of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016.
• By letter dated September 24, 2026, the bank, after examination and discussion with the Competent Authority, found the proposal not acceptable and rejected it.

What it means

Section 12A allows an insolvency case to be withdrawn if creditors approve a settlement. With the proposal rejected, that exit route has not succeeded at this stage. The company states that the CIRP shall continue in accordance with the provisions of the IBC, which typically means the process moves ahead towards a resolution plan or the outcomes provided under the Code.

Why shareholders watch this

In an insolvency resolution, creditors' claims are dealt with ahead of equity shareholders, and the eventual outcome of a resolution plan can materially affect existing shareholding. Investors may view the continuation of CIRP as prolonging uncertainty around the company's future.

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