NCLAT Sets Aside Mechanical Rejection for Lack of Individual Assessment; Revives Allottee Claims for Fresh Consideration
- REEDLAW
- Jul 2
- 3 min read
The National Company Law Appellate Tribunal (NCLAT) set aside the mechanical rejection of claims for lack of individual assessment by the Adjudicating Authority and revived the allottee claims for fresh consideration.
The National Company Law Appellate Tribunal (NCLAT), Principal Bench, comprising Justice Ashok Bhushan (Chairperson) and Mr. Arun Baroka (Technical Member), while adjudicating a batch of company appeals on Monday, held that the Adjudicating Authority erred in mechanically rejecting the appellants’ claims solely on the basis of a prior order passed in I.A. 5177/2022. The Tribunal noted that the Authority had failed to examine the individual facts, documents, and circumstances specific to each applicant, particularly in cases where the Resolution Professional had not disputed the receipt of payments or the existence of builder-buyer agreements. Emphasising the need for independent evaluation, the NCLAT concluded that such claims merited separate consideration and accordingly revived the interlocutory applications for fresh adjudication.
The National Company Law Appellate Tribunal (NCLAT) decided a batch of appeals challenging the common order passed by the Adjudicating Authority (NCLT, New Delhi Bench-II), which had rejected I.A. Nos. 1377/2023, 1375/2023, 1376/2023, and 1385/2023. These applications were filed by various appellants seeking recognition as ‘financial creditors in a class’ (i.e., allottees) in the ongoing CIRP of the corporate debtor, M/s Indirapuram Habitat Centre Private Limited. The corporate debtor had entered into multiple Buyer Agreements with the appellants for Club Suite units and assured them fixed returns on their investments. The appellants claimed to have paid the entire consideration, supported by payment receipts and other documents, and asserted that they were entitled to be treated as allottees.
The NCLT had rejected these applications primarily by relying on its earlier order in I.A. No. 5177/2022, which was dismissed due to a lack of verifiable allotment records in the corporate debtor’s CRM system. The Adjudicating Authority observed that RP must rely on the books of accounts and official records of the corporate debtor and could not entertain documents outside the company’s system to avoid malpractice. Without evaluating the individual merits of each appellant’s claim or documents, such as Builder Buyer Agreements and payment receipts, the Tribunal summarily rejected all the applications, citing parity with I.A. No. 5177/2022.
The appellants argued that the rejection was arbitrary and lacked due consideration of distinct facts, including admitted payments and agreements that evidenced the allotments. They also challenged the RP’s belated assertion that the units in question had been surrendered or cancelled, pointing out that no refund had ever been issued and that such a claim was made for the first time in the appellate stage without any corroboration in the original reply before the NCLT.
Agreeing with the appellants, the NCLAT held that the Adjudicating Authority had erred in summarily dismissing the applications without evaluating their individual facts and evidence. The Appellate Tribunal emphasised that each application required independent scrutiny, particularly since the basis of rejection (i.e., the decision in I.A. No. 5177/2022) was not shown to be factually or legally identical to the present cases. The NCLAT set aside the NCLT’s order dated 21.11.2023 to the extent it related to I.A. Nos. 1377/2023, 1375/2023, 1376/2023, and 1385/2023 and revived the applications for fresh adjudication. Both the appellants and the RP were granted liberty to file additional affidavits within two weeks, and the matter was remanded to the Adjudicating Authority to be decided afresh without any observation on the merits.
Mr. Anshuj Dhingra and Ms. Akansha Sharma, Advocates, represented the Appellant.
Mr. Sumesh Dhawan, Mr. Praful Jindal and Mr. Shaurya Shyam, Advocates, appeared for the RP along with Mr. N.K. Sharma, RP in person.
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