The Supreme Court has held that subsequent developments in parallel proceedings, including insolvency resolutions and One Time Settlement (OTS) approvals, cannot be invoked to reopen a Special Leave Petition (SLP) that has already been dismissed.
The Bench of Justice Vikram Nath and Justice Sandeep Mehta observed that once an SLP is dismissed, the Court becomes functus officio and cannot revisit the matter except under exceptional and narrowly defined circumstances.
The dispute originated from an Agreement to Sell dated August 13, 2021, concerning a commercial property in Gurugram valued at ₹21 crore. The petitioner claimed to have paid substantial amounts, including earnest money and payments towards a proposed OTS with the secured creditor bank.
When the sellers allegedly backed out of the agreement, the petitioner initiated a civil suit seeking specific performance along with interim relief to restrain the creation of third-party rights. While the trial court initially granted interim protection, the appellate court reversed the order, and the Punjab & Haryana High Court upheld that reversal, holding that the agreement was contingent upon the bank’s approval of the OTS.
The Supreme Court subsequently dismissed the SLP challenging the High Court’s order on February 25, 2025.
The petitioner later filed a Miscellaneous Application seeking recall of the dismissal order, relying on subsequent developments during the pendency of the SLP. These included approval of an OTS between the corporate debtor and the bank, withdrawal of Corporate Insolvency Resolution Process (CIRP) under Section 12A of the Insolvency and Bankruptcy Code, and alleged suppression of these facts before the Court.
It was contended that these developments materially altered the basis of the earlier decision and warranted reconsideration.
Table of Contents
Limited Scope of Post-Disposal Applications
The Court held that a Miscellaneous Application filed after disposal of an SLP is maintainable only in rare cases, such as correction of clerical errors or where implementation of directions becomes impossible. Since the earlier dismissal order was non-executory, the present MA did not meet the threshold for maintainability.
Parallel Proceedings Cannot Reopen Finality
Rejecting the petitioner’s core argument, the Court categorically ruled that subsequent developments in separate or parallel proceedings—such as insolvency processes or settlements—cannot be used to reopen a concluded SLP. The Bench noted that such developments may give rise to independent remedies but cannot disturb the finality of judicial orders passed in earlier proceedings.
No Fraud Established
While acknowledging that fraud can justify recall of a judicial order, the Court found no evidence that the earlier dismissal was obtained by fraud. It observed that mere allegations of suppression, without substantiation, are insufficient to invoke such an exceptional remedy.
IBC Framework and Commercial Wisdom
The Court also declined to examine the merits of the OTS or compare competing financial offers. It reiterated that decisions taken by the Committee of Creditors (CoC) under the IBC fall within the realm of commercial wisdom and are not subject to judicial review except on limited statutory grounds.
Case Details
Case Title: M/S.Lamba Exports Pvt. Ltd. Versus M/S.Dhir Global Industries Pvt. Ltd. And Ors.
Citation: JURISHOUR-264-SC-2026
Case No.: Misc.Application No.1256 Of 2025
Date: 23/06/2026
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