Case Law Details
Lotus City Plot Buyers Welfare Association Vs Three C Homes Pvt. Ltd & Ors. (NCLAT Delhi)
Conclusion: In present facts of the case, the Hon’ble Appellate Tribunal held that Liquidation is the last resort and this programme of homebuyers needs some calibration and proper evaluation.
Held: In present facts of the case, the appeal have been filed u/s 61 of the ‘Insolvency and Bankruptcy Code, 2016’, wherein the ‘Adjudicating Authority’ has rejected the ‘Resolution Plan’ and has directed the ‘Resolution Professional’ to file appropriate application for seeking liquidation order of the Corporate Debtor namely- M/s. Three C Homes Pvt. Ltd. The Adjudicating Authority considered ‘Liquidation value ‘of Corporate Debtor is Rs.480.70 Crore while Resolution Plan involves infusion of only Rs.95 crore by the Resolution Applicant and that too over a period of two years.
The Adjudicating Authority came to the conclusion that ‘Resolution Plan’ does not have any potential to fulfil the dreams of homebuyers which is at just 19.77 % of the liquidation value of Corporate Debtor.
The Appellant contended that the adjudicating Authority have not considered the quantum of debt due to allottees as after giving the possession of plots to allottees, the debt due to allottees would stand satisfied and the quantum which shall be paid by Resolution Applicant to Ex-management. The Appellant, has also stated that the Resolution Plan had been approved with 62.9% voting share which would be considered as 100% as per Section 25A (3A) of the Code in favour of the ‘Resolution Plan’. They have also raised the issue that the decision of the CoC in respect of commercial issues cannot be challenged by the Adjudicating Authority.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
Author Bio
