Appellants Who Filed Their Claims As Real Estate Allottees Are A Part Of Home Buyers And Cannot Ask Refund Separately: NCLAT Delhi
The National Company Law Appellate Tribunal (“NCLAT”), Delhi Bench, comprising of Justice Rakesh Kumar Jain (Judicial Member) and Mr Naresh Salecha (Technical Member) has dismissed an appeal and held that the Appellants, who have filed their claims as Real Estate Allottees, are considered part of the home buyers. Therefore, if the home buyers have already been represented...
The National Company Law Appellate Tribunal (“NCLAT”), Delhi Bench, comprising of Justice Rakesh Kumar Jain (Judicial Member) and Mr Naresh Salecha (Technical Member) has dismissed an appeal and held that the Appellants, who have filed their claims as Real Estate Allottees, are considered part of the home buyers. Therefore, if the home buyers have already been represented by an authorized representative who has approved the resolution plan, the Appellants cannot ask for a refund separately.
Background Facts
Rajib Biswas (“Appellant 1”) and Mr Sunil Dwivedi (“Appellant 2”) booked units in the project Lotus Arena floated by M/s Arena Superstructures Pvt. Ltd. (“Respondent/Corporate Debtor”) in Sector 79, Noida. Later, the Appellants approached UP RERA for a refund of the amount.
On 07.02.2020, a recovery certificate was issued for an amount of Rs. 76.53 lakhs in favour of Appellant 1.
On 13.02.2020, a recovery certificate was issued for an amount of Rs. 47.46 lakhs in favour of Appellant 2.
On 19.07.2023, the Resolution plan was approved by the National Company Law Tribunal (“NCLT”) and the Appellants did not challenge the same. The Appellants filed their claims before the Resolution Professional as Real Estate Allottees. The Resolution Professional accepted the claims of the Appellants. However, the Appellants claimed that they were entitled to the decretal amount and not the amount which has been admitted by the Resolution Professional. Following this, the Appellants filed an application before the NCLT.
On 11.10.2022, NCLT rejected the application on the ground that the Appellants filed their claims as Real Estate Allottees who are part of home buyers and have been represented by the authorised representative in the Resolution Plan, who voted in favour of the plan, and now the Appellants cannot ask for a refund separately.
Aggrieved by the order of NCLT the Appellants filed an application before the NCLAT.
Contentions of Appellant
The Appellants argued that they are entitled to the decretal amount and not the amount which has been admitted by the Resolution Professional.
The Appellants referred to a judgement in Vishal Chelani & Ors. Vs. Debashis Nanda, 2023 SCC OnLine SC 1324
“In view of the foregoing reasons, the impugned order is hereby set aside; the appellants are declared as financial creditors within the meaning of Section 5(8)(f) (Explanation) and entitled to be treated as such along with other home buyers/financial creditors for the purposes of the resolution plan which is awaiting final decision before the adjudicating authority.”
Contentions of Respondent
The Respondent opposed the submissions and argued that there is no error in the order passed by NCLT. The Respondent further argued that the Resolution plan has been approved by the NCLT on 19.07.2023 and the Appellants have not challenged the same.
The Respondent argued that in Vishal Chelani & Ors. (Supra) it has been held that the Allottees are to be treated equally to the other homebuyers/financial creditors and therefore the Appellants cannot claim special treatment.
NCLT Verdict
NCLAT dismissed the appeal and held that the Appellants, who have filed their claims as Real Estate Allottees, are considered part of the home buyers. Therefore, if the home buyers have already been represented by an authorized representative who has approved the resolution plan, the Appellants cannot ask for a refund separately.
NCLAT observed that in Vishal Chelani & Ors. (Supra) it was held that allottees are not to form a separate class and are to be treated the same as other home buyers/financial creditors for the purpose of a resolution plan.
The NCLAT further observed that the Appellants had obtained a decree from UP RERA and a provision has already been made in the resolution plan for the purpose of refund in Clause (B3)(c).
Case Title: Rajib Biswas & Anr. Vs Arena Superstructures Pvt. Ltd. & Ors.
Case No.: Comp. App. (AT) (Ins) No. 1488 of 2022 & I.A. No. 4701 of 2022
Counsel For Appellant: Ms. Pooja M. Sehgal, Mr. Prashant Jain, Ms. Atrayei Ghosh, Mr. Subham Paliwal, Ms. Nitya Prabhakar, Advocates
Counsel For Respondent : Mr. Prithu Garge, Mr. Parth B., Advocates