Bhojraj Verma & Or Vs Garima Real Estate & Allied Ltd (NCLT Indore)
NCLT Indore Admits Insolvency Petition Against Garima Real Estate, Citing Investor Default
The National Company Law Tribunal (NCLT), Indore Bench, has delivered a judgment in the case of Bhojraj Verma & Ors. Vs Garima Real Estate & Allied Limited, admitting a petition filed under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016, and initiating the Corporate Insolvency Resolution Process (CIRP) against the real estate company, Garima Real Estate & Allied Limited (the Corporate Debtor).
Case Background and Financial Debt
The application was initially filed on November 6, 2019, by six Financial Creditors, led by Mr. Bhojraj Verma, seeking to recover a financial debt that included principal and interest, aggregating to ₹9,52,000. The debt arose from investments made by the creditors into the Corporate Debtor’s schemes through Application Forms and Application-cum-Agreements, which promised fixed returns on maturity (maturity date: April 30, 2017).
The Corporate Debtor, engaged in real estate activities, had been previously flagged by the Securities and Exchange Board of India (SEBI). In an order dated May 3, 2016, SEBI prohibited the company and its directors from raising further funds under Collective Investment Schemes (CIS) and directed them to wind up the schemes and refund investors within three months. Despite this directive and the maturity of the repayment period, the Corporate Debtor failed to honor its obligations, resulting in a continuing default since 2017.
