Resolution Professional's plea for blanket warranty coverage rejected; Tribunal mandates cooperation between Tata Motors and Resolution Professional for detailed assessment under existing warranty terms.
In a significant judgment dated October 7, 2026, the National Company Law Tribunal (NCLT), Ahmedabad Bench, delivered a detailed ruling in the matter of Indian Renewable Energy Development Agency Limited v. Gensol Engineering Limited, addressing warranty disputes concerning a fleet of Tata electric vehicles (EVs) amidst ongoing Corporate Insolvency Resolution Process (CIRP).
The case arose when the Resolution Professional (RP) of Gensol Engineering Limited, which owned a large fleet of Tata EVs used in its electric vehicle leasing business, sought directions against Tata Motors Limited (specifically Tata Motors Passenger Vehicles Limited - TMPVL) to provide comprehensive warranty documentation and to honor warranty coverage for the entire fleet. The RP contended that battery defects and malfunctions affecting the Tata EVs were due to inherent manufacturing issues and not due to misuse or neglect, thus falling under warranty coverage, which was critical to preserve the assets' value during CIRP.
The RP's prayers included a blanket declaration that warranties for the entire fleet remained valid and subsisting, along with demands for cooperation in servicing, maintenance, and technical support. Additionally, the RP sought a Root Cause Analysis (RCA) report concerning a fire incident involving one EV.
Tata Motors Limited and TMPVL contested the application on multiple grounds, including the maintainability of the petition under Section 60(5) of the Insolvency and Bankruptcy Code (IBC), 2016. They argued that the warranty entitlements were governed strictly by vehicle-specific Owner's Manuals, with warranties subject to limitations based on time, mileage, maintenance history, and exclusions such as unauthorized repairs and misuse. Tata Motors denied any refusal to honor valid warranty claims and emphasized that the RP's request sought an impermissible judicial re-writing of contractual terms by treating the entire fleet as uniformly covered.
The Tribunal examined the pleadings, correspondence, and documentary evidence, including the unsigned draft Service Level Agreement (SLA) cited by the RP, which proposed a six-year or 3,00,000 km battery warranty. However, the Tribunal noted that no executed SLA was produced, and the Owner's Manuals were the operative warranty documents specifying a 36-month/1,25,000 km or 3-year/1,25,000 km warranty period, whichever was earlier, subject to standard exclusions.
While the Tribunal acknowledged the RP's statutory duty under Sections 20 and 25 of the IBC to protect and preserve the assets and maintain the Corporate Debtor as a going concern, it held that Section 60(5) jurisdiction cannot be invoked to enlarge contractual rights or grant blanket reliefs disregarding the vehicle-specific warranty terms. It was observed that warranty validity depended on factors intrinsic to each vehicle, such as age, mileage, service history, and compliance with warranty conditions.
Importantly, the Tribunal recognized Tata Motors' submission of a reconciled list of approximately 7,756 Tata EVs owned by the Corporate Debtor and welcomed the three-stage vehicle-wise verification process proposed by TMPVL. This process includes: (i) Preliminary Virtual Assessment based on vehicle data and service records; (ii) Visual and Non-Invasive Assessment at a mutually agreed location; and (iii) Detailed Workshop Assessment at authorized service centers to determine warranty applicability and necessary repairs.
The Tribunal directed the Resolution Professional and Tata Motors Passenger Vehicles Limited to cooperate and carry out the vehicle-wise reconciliation and assessment in accordance with the Owner's Manuals and the proposed verification mechanism. Valid warranty claims of eligible vehicles are to be processed through the authorized service network strictly following the applicable warranty terms and conditions.
Regarding the fire incident on May 11, 2026, the Tribunal refrained from making any findings on the cause or liability, noting that the technical investigation depended on the completion of insurance-related procedures. It also declined the RP's request concerning GBT charging infrastructure, finding no contractual or statutory obligation on Tata Motors to provide or replace such infrastructure.
In conclusion, the NCLT disposed of the application, denying the blanket confirmation of warranty coverage for the entire fleet but ordering vehicle-specific verification and cooperation to uphold existing contractual warranty rights without creating new obligations.
This judgment underscores the careful balancing of the RP's role in preserving corporate assets during insolvency with the sanctity of existing contractual obligations between manufacturers and customers, especially in complex asset-intensive industries like electric vehicles.
Bottom Line:
Insolvency and Bankruptcy Code, 2016 Section 60(5) Resolution Professional seeking blanket direction to treat warranty of entire EV fleet as valid and subsisting - Held, NCLT cannot enlarge contractual warranty rights or grant fleet-wide declaration where warranty depends on vehicle-wise factors such as age, mileage, service history and exclusions - However, since EVs formed part of Corporate Debtor's assets during CIRP, RP and manufacturer directed to undertake vehicle-wise reconciliation and assessment as per owner manuals and proposed verification mechanism - Valid claims to be processed in accordance with applicable warranty terms.
Statutory provision(s):
Insolvency and Bankruptcy Code, 2016 Section 20, Section 25, Section 60(5)
