Verified Homebuyer Claims in CIRP Entitle Possession: Supreme Court Sets Aside NCLAT & NCLT Orders
- REEDLAW
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REEDLAW Legal News Network reports:Â In a landmark decision delivered on 9 September 2025, the Supreme Court ruled that bona fide homebuyers whose claims are duly verified and admitted during the Corporate Insolvency Resolution Process (CIRP) cannot be classified as belated claimants under an approved Resolution Plan. The Court clarified that such homebuyers are entitled to possession of their allotted units and reaffirmed that verified claims must be honoured fully in line with the Insolvency and Bankruptcy Code (IBC) and the approved plan.
The Supreme Court Bench comprising Justice Sanjay Kumar and Justice Satish Chandra Sharma, while adjudicating a Civil Appeal filed by homebuyers, held on 9 September 2025Â that verified and admitted claims cannot be disregarded or treated as delayed submissions under the Resolution Plan. The Bench emphasised that bona fide homebuyers who have fulfilled their obligations during the CIRP are entitled to possession of their allotted units, underscoring that the sanctity of verified claims under the Code and approved Resolution Plan must be preserved.
The Supreme Court, in Civil Appeal No. 4296 of 2025, allowed the appeal filed by the homebuyers against the orders of the NCLAT and NCLT which had denied them possession of their allotted apartment in the IREO Rise (Gardenia) project, Mohali developed by M/s Puma Realtors Pvt. Ltd. The Appellants had booked the apartment in 2010 and executed the Buyer’s Agreement in 2011, paying nearly the entire sale consideration of Rs. 57,56,684/- out of Rs. 60,06,368/-. Possession was contractually due in 2013 but was never delivered, prompting the Appellants to approach the consumer forum, which deferred the claim to the ongoing CIRP proceedings after the Corporate Debtor was admitted under Section 7 of the IBC in 2018.
During the CIRP, the Appellants submitted their claims first through a representative in January 2019 and again via email in February 2020 following a request by the Resolution Professional for resubmission of claims. Their claim was verified and admitted, appearing in the published list of financial creditors on 30 April 2020. Despite this, the Resolution Plan, approved by the Committee of Creditors in August 2019, classified their claim under Clause 18.4(xi) as belated, limiting their entitlement to only 50% refund of the paid consideration. The NCLT and NCLAT upheld this treatment, rejecting the Appellants’ plea for possession under Clause 18.4(vi)(a), which applies to verified and admitted claims.
The Supreme Court examined the admitted facts and found that the Appellants’ claim had indeed been verified and incorporated into the list of creditors, thereby acquiring full legal recognition within the CIRP. It held that relegating bona fide homebuyers, who had paid nearly the entire sale consideration and whose claims were duly admitted, to the status of belated claimants under Clause 18.4(xi) was contrary to the objectives of the Insolvency and Bankruptcy Code and inequitable. The Court emphasised that Clause 18.4 differentiates between verified claims and belated/unverified claims, and this distinction could not be ignored without undermining the statutory framework and fairness of the resolution process.
Accordingly, the Supreme Court set aside the orders of the NCLAT and NCLT, directing the Respondents to execute the conveyance deed and deliver possession of Apartment No. GBD-00-001, Block D, IREO Rise (Gardenia), Mohali, to the Appellants within two months. The appeal was allowed in full, while pending applications were disposed of, and no order as to costs was passed.
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