NCLT Mumbai Approves Adani Goodhome’s Resolution Plan For Radius Estates & Developers

Background Facts

Radius Estates and Developers Pvt. Ltd. (“Corporate Debtor”) entered into a joint venture as co-developer with the MIG (Bandra) Realtors and Builders Pvt. Ltd., for redevelopment of a land situated at Bandra (East) Mumbai (“Project”). The Project included construction of residential flats/units for: (i) rehabilitation of the members of the Middle-Income Group Co-operative Housing Society; and (ii) as part of the free-sale component.

The Land was owned by the Maharashtra Housing and Area Development Authority (“MHADA”) and has been leased to Middle Income Group Co-operative Housing Society.

The Corporate Debtor commenced selling of flats and collection of monies from potential flat purchasers. However, the construction of the Project came to a halt in January 2020.

Subsequently, Beacon Trusteeship Ltd. (“Financial Creditor”) filed a petition under Section 7 of the Insolvency and Bankruptcy Act, 2016 (“IBC”), seeking initiation of Corporate Insolvency Resolution Process (“CIRP”) against Corporate Debtor. The Adjudicating Authority initiated CIRP against the Corporate Debtor on 30.04.2021.

On the CIRP commencement date, the Corporate Debtor had sold 224 units and was left with 146 units available for sale and the Project remained incomplete. Out of the 15 proposed buildings, only 9 buildings were partially constructed. The construction of the remaining 6 buildings had not even commenced.

Upon an invitation by the Resolution Professional for submission of Resolution Plans, M/s. Adani Goodhomes Pvt. Ltd. (“Successful Resolution Applicant”) and Ashdan Developers Pvt. Ltd. submitted plans for the Corporate Debtor. The resolution plan submitted by M/s. Adani Goodhomes Pvt. Ltd. (“Successful Resolution Applicant”) was approved by the Committee of Creditors (“CoC”) with 83.93% voting share.

Adani’s Resolution Plan has proposed that Homebuyers who have not sought refund and/or who do not have orders for refund, will be given units in the Project. Further, the secured Financial Creditors would be paid a total of Rs. 31,49,82,262/- as against their total admitted claim of Rs. 11,86,66,20,306/-. The unsecured Financial Creditors other than related parties will be paid Rs. 47,12,798/- as against a total admitted claim of 4,71,27,97,999/-. While the related party unsecured Financial Creditors are to be paid NIL amount. The Operational Creditors (workmen and employees) would be paid a total of Rs. 1,51,89,094/- towards their admitted claims. However, the other Operational Creditors such as Government authorities and others would be paid NIL amount.

The Resolution Professional filed an application under Section 30(6) of IBC for approval of resolution plan by the Adjudicating Authority.

The Adjudicating Authority vide an order dated 09.01.2023 has approved the Resolution Plan submitted by M/s. Adani Goodhomes Pvt. Ltd. for Radius Estates and Developers Pvt. Ltd.

Case Title: Beacon Trusteeship Ltd. v Radius Estates and Developers Pvt. Ltd.

Case No.: CP (IB) No: 1390 of 2020

Counsel for Applicant: Ld. Senior Counsel Mr. Mustafa Doctor a/w Mr. Nausher Kohli, Mr. Devesh Juvekar, Mr. Ashish Parwani, Mr. Dikshat Mehra, Mr. Yash Jain and Miss Honey Chandnani

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