Case Number: Civil Appeal No. 3778 of 2020

Judges Name: Hon’ble Judges M.R. Shah J, B.V. Nagarathna J.

Order dated: 03.03.2022

Facts of the case:

• This is an appeal preferred by the Amit Katyal (Appellant) against Meera Ahuja and others (Respondents) challenging the decision passed by the Hon’ble National Company Law Appellate Tribunal (NCLAT). The Respondent No.4 Jasmine Buildmart Pvt Ltd. (Corporate Debtor) started a housing project which could not be completed even after eight years.
• The home buyers preferred an application under Section 7 of the Insolvency & Bankruptcy Code, 2016 (IBC) before the Hon’ble National Company Law Tribunal (NCLT), Delhi seeking initiation of Corporate Insolvency Resolution Process (CIRP). The Hon’ble NCLT admitted the application of CIRP and appointed an Interim Resolution Professional (IRP). On appeal before the Hon’ble NCLAT by the Appellant, the Hon’ble NCLAT dismissed the appeal. The Appellant preferred an appeal before the Hon’ble Supreme Court against the decision of the Hon’ble NCLAT. The matter was adjourned from time to time as the parties were interested in settling and the Hon’ble Supreme Court allowed the settlement.

Hon’ble Supreme Court observed/held as follows:

• The Respondents filed an application seeking to withdraw the CIRP proceedings under Article 142 of the Constitution of India read with Rules 11 and 12 of the National Company Law Tribunal Rules, 2016 stating that they have reached a settlement with the Appellant.
• The Hon’ble Court noted that out of the total 128 buyers of 176 units, 82 (79 +3) home buyers have settled with the Respondent No.4.
• The cases of Swiss Ribbons Private Limited and Another v. Union of India and Kamal K. Singh v. Dinesh Gupta & Another were cited in which Court permitted the original applicants before the Adjudicating Authority (the Hon’ble NCLT) to withdraw the CIRP proceedings in view of the settlement entered into between the parties.
• The Hon’ble Court discussed Section 12 A of IBC and noted that in this case, though Committee of Creditors has been constituted, there was a stay in the CIRP proceedings and no further proceedings took place.’
• Given, the facts of the case and terms of the settlement where by 82 home buyers will get possession of the properties within a year and also the fact that original applicants before the Hon’ble NCLT have also settled the dispute, the Hon’ble Court exercised its powers under Article 142 of the Constitution of India read with Rule 11 of the NCLT rules, 2016 and permitted the original applicants to withdraw the CIRP proceedings.
• The Hon’ble Court set aside the order passed by NCLT and impugned judgment and order passed by NCLAT.

The Hon’ble Supreme Court disposed the appeal