The Supreme Court allowed the withdrawal of CRIP against the builder in an application filed by three homebuyers.
The respondent Corporate Debtor Jasmine Buildmart Pvt. Ltd. had come out with a Gurgaon based housing project, namely, Krrish Provence Estate. The respondent Corporate Debtor could not complete the project even after a period of eight years. Therefore, the original applicants who were the home buyers preferred Section 7 application before the Adjudicating Authority/NCLT, Delhi seeking initiation of CIRP against respondent Corporate Debtor.
Advocate K.V. Vishwanathan and Advocate Nakul Diwan, appearing on behalf of the three impleaders – respective home buyers and the Association and Advocate Kapil Sibal, appearing on behalf of the appellant have jointly submitted that a majority of the home buyers and the appellant and Corporate Debtor have settled the disputes and a joint statement regarding proposed settlement plan signed by the respective parties is filed under which, the appellant and respondent No.4 (Corporate Debtor) have undertaken that they shall complete the entire project within one year from the date of settlement and offer possession of the flats to the home buyers.
The division bench of Justice M.R. Shah and Justice B.V. Nagarathna noted that out of the total 128 home buyers of 176 units, 82 homebuyers are against the insolvency proceedings and the original applicants have also settled their dispute with the appellant and corporate debtor.
The court said that more particularly when the withdrawal of the CIRP proceedings initiated by the original applicants is allowable by the NCLT in exercise of its powers under Rule 11 of the NCLT rules, 2016 and in the peculiar facts and circumstances of the case, instead of relegating the original applicants to approach the NCLT/Adjudicating Authority by moving an application under Section 12A of the IBC, it is of the opinion that this is a fit case to exercise powers under Article 142 of the Constitution of India as the settlement arrived at between the home buyers and the appellant and corporate debtor – company shall be in the larger interest of the home buyers and under the settlement and as undertaken by the appellant/corporate debtor, out of 128 home buyers, 82 home buyers are likely to get possession within a period of one year, for which they are waiting since last more than eight years after they have invested their hard earned money.
To do the complete justice in the matter and considering the fact that after the admission of the CIRP proceedings, IRP was appointed and COC was constituted by the IRP and it is reported by the IRP that he had incurred some expenditure, the court directed the appellant to pay a sum of Rs.6,00,000/- to the IRP, to be paid towards the expenditure that might have been incurred by the IRP and also the litigation costs, which shall be paid to the IRP by way of a Demand Draft within a period of two weeks.
Case title: Amit Katyal v/s Meera Ahuja and others
Citation: CIVIL APPEAL NO. 3778 OF 2020