Rejection Solely on Ground of Delay Unsustainable: NCLAT Orders Inclusion of Genuine Homebuyer Claims in Resolution Plan [Read Order]
The NCLAT clarified that where payments made by allottees are duly reflected in the corporate debtor’s records, such claims must be considered genuine and included in the resolution process through appropriate modification of the plan.
In a recent ruling, the equitable treatment of homebuyers under the Insolvency and Bankruptcy Code (IBC), the National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, has set aside the order of the Adjudicating Authority (NCLT) which had dismissed belated claims of several homebuyers in the Today Homes Noida Pvt. Ltd. insolvency proceedings.
The NCLAT, headed by Chairperson Justice Ashok Bhushan, delivered a composite judgment in a batch of appeals filed by multiple homebuyers, including Dr. Anubha Varun and others, challenging the NCLT’s order dated 22 January 2025 which dismissed their applications for acceptance of belated claims in the corporate insolvency resolution process (CIRP) of Today Homes Noida Pvt. Ltd. The Adjudicating Authority had rejected the claims on the sole ground that they were filed beyond 90 days from the commencement of the CIRP.
The appellant homebuyers of the “Ridge Residency” project in Noida, had contended that they were bona fide allottees who had made substantial payments toward their residential units, many through tripartite loan arrangements with banks.
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Their claims, though delayed, were supported by payment records maintained in the books of the corporate debtor. The appellants cited genuine reasons for the delay, including the COVID-19 pandemic, overseas residence, and lack of notice of the CIRP proceedings.
The NCLAT noted that the CIRP commenced on 20 August 2019 and that the resolution plan was approved by the Committee of Creditors (CoC) on 4 March 2020. The appellants filed their claims in 2023 and 2024, which the Resolution Professional rejected citing delay.
The Tribunal observed that an earlier NCLAT order dated 8 May 2024 had expressly directed the Adjudicating Authority to consider the homebuyers’ applications on merits while sending the resolution plan back to the CoC for resubmission in light of the Supreme Court’s ruling in Greater Noida Industrial Development Authority v. Prabhjit Singh Soni (2024).
The appellate bench held that the NCLT misinterpreted this remand as being confined solely to NOIDA’s claim as a secured creditor. It ruled that the direction covered consideration of all pending claims, including those of homebuyers, and that the Adjudicating Authority’s narrow reading was contrary to the earlier appellate mandate.
Referring to its own precedent in Puneet Kaur v. K.V. Developers Pvt. Ltd. (2022), the Tribunal reiterated that once payments made by homebuyers are recorded in the corporate debtor’s accounts, such claims cannot be brushed aside merely for being delayed.
The tribunal said that the essence of the IBC is to ensure fair treatment of all stakeholders and that procedural rigidity cannot override substantive justice, especially where the buyers’ investments are duly acknowledged.
The bench further observed that the Resolution Professional’s affidavit, filed before the NCLT, admitted receipt of payments from each appellant, establishing their bona fide status as financial creditors in a class. In such circumstances, it held, the successful resolution applicant (SRA) and the resolution professional were obliged to accommodate these claims through an addendum to the resolution plan.
Accordingly, the bench of Ashok Bhushan (Judicial Member) set aside the impugned NCLT order and directed the resolution professional and the SRA to prepare a second addendum to the resolution plan, ensuring inclusion and equitable treatment of all genuine homebuyer claims whose payments were reflected in the debtor’s records.
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