Claims For Interest Based On RERA Order Do Not Translate Into Financial Debt Under IBC: NCLT Delhi

Background

An application was filed under Section 60(5) of the Insolvency and Bankruptcy Code, 2016 read with Rule 11 of NCLT Rules, 2016 by Mr. Yogesh Kumar Gupta and another against Mr. Devendra Umrao, the Resolution professional (RP) of M/s Opulent Infradevelopers Pvt Ltd who is the Corporate Debtor. A CIRP process of the Corporate Debtor was initiated on 12^th July, 2022 and a Resolution Plan by Amtex Infrastructure was approved by the Committee of Creditors on 8^th July, 2023 with 100% votes, however its approval by the Tribunal is still pending.

The Applicants who were genuine allottees of a residential flat (Unit No. 014, Marriott Tower, Urbtech 168's Xaviers project at Noida) pursuant to an allotment letter dated 1^st June, 2013. They had made significant payments under a construction-linked plan but faced inflated demands from the Corporate Debtor in 2018. These arbitrary demands were challenged before the UP RERA which by order dated 7^th August, 2019 quashed the demands, directed issuance of a new demand letter, delivery of possession, registration of conveyance deed and adjustment of any further demands against delayed possession charges payable to the Applicants.

Despite receiving possession on 1^st November, 2021 on an “as is where is” basis without any occupancy certificate and without payment of delayed possession charges, no new lawful demand letter was issued by the Corporate Debtor. After the commencement of CIRP, unaware of the proceedings, the Applicants filed a contempt petition before the UP RERA leading to a recovery certificate which remained unenforceable due to the moratorium under Section 14 of the IBC.

The Applicants found out that the CIRP in September 2023 was upon disconnection of electricity and filed a claim 9 initially through incorrect Form-B and later through Form CA which the RP rejected citing delay.

Appellant's Contention

The Applicant contented that the claims of the undisputed allottees should be accepted invoking NCLAT's ruling in Puneet Kaur v. K.V. Developers Pvt Ltd which emphasized upon the extinguishment of homebuyer's claims which occurs only post-approval of the Resolution Plan. They also challenged the RP's demands post the CIRP asserting that no dues could be enforced without an occupancy certificate and that any dues must be adjusted against delayed possession charges.

RP's Contentions

However, the RP argued that the Applicants have been in possession since 2021 and that their claim have been belated. Their primary grievance is regarding the sale deed execution (not a financial debt) and the maintenance dues must be cleared to maintain the project as a going concern. The RP relied on the NCLAT judgement in Pooja Mehra v. Nilesh Sharma to emphasize on the strict adherence to CIRP timelines.

NCLAT Judgement

The National Company Law Tribunal (NCLT), New Delhi dismissed the application filed by the Applicants. It held that the Applicants had already taken possession of their flat on 1^st November, 2021 and were enjoying peaceful possession. With respect to that there is no existing financial debt under Section 5(8)(f) of the IBC. Their complaint was only regarding the execution of sale deed which does not qualify as financial claim. The Tribunal also notes that the Applicant's claim for delayed possession interest based on the UP RERA order made them decree-holders under Section 3(10) of the IBC and not 'creditors in class”. Since the RERA recovery proceedings were initiated after the CIRP begun and during the moratorium, they were barred under Section 14 of IBC. The Tribunal cited the NCLAT judgement in Pooja Mehra v. Nilesh Sharma, which emphasized that belated claims after significant delay cannot be entertained and distinguished it from Puneet Kaur v. K.V. Developers Pvt Ltd. based on different facts.

Therefore, the Tribunal found no merit in the Applicant's claim and dismissed the application.

Case Title: M/s GENESIS COMTRADE PRIVATE LIMITED VS M/s OPULENT INFRADEVELOPERS PVT. LTD

Case Number: IA 1796(ND)/2024 in CP No.: IB 304(ND)/2022

Tribunal: National Company Law Tribunal, New Delhi

Coram: Shri Manni Sankariah Shanmuga Sundaram, Hon'ble Member (Judicial) and Dr. Sanjeev Ranjan, Hon'ble Member (Technical)

For Applicant: Adv. Vaibhav Mahajan, Adv. Harshita Aggarwal, Adv. Aditi Kumar

For RP: Adv. Gaurav Mitra, Adv. Abhishek Parmar

Date of Judgement: 17.04.2025

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