NCLT Initiates CIRP Against Raheja Developers

NCLT Initiates CIRP Against Raheja Developers

Over 40 buyers claimed a default of Rs.112.90 crore against the realtor

The National Company Law Tribunal (NCLT) has initiated insolvency proceedings against Raheja Developers on a petition filed by flat allottees of its Sector 109, Gurugram, Haryana-based Raheja Shilas project.

The allottees made payments, but the realty firm failed to deliver the units on time attributing the delay to uncontrollable circumstances.

The NCLT while appointing Manindra K Tiwari as an Interim Resolution Professional (IRP) said that the realty firm had a ‘debt due and default’ and referred it to Corporate Insolvency Resolution Process (CIRP).

A two-member bench comprising Justice Ramalingam Sudhakar (President) and AK Srivastava (Technical Member) stated, "The application of the applicants under Section 7 of the Insolvency & Bankruptcy Code, 2016, for initiating the CIRP against Raheja Developers is admitted.”

It added, "There is a default on the part of the corporate debtor in terms of nonpayment of the debt due (delivery of the units) against the amount raised from them under the real estate project when the debt has become due and payable.”

The bench explained that possession was to be given during 2012-2014 with a grace period of six months. However, it was extended further. The debt was acknowledged via various emails, and the default continues.

The petitioners submitted paying over 95 percent of the total sale price and 100 percent of the demands as per the demand letter issued by Rahejas.

In defense, the realtor remarked that the delay of over four years was on account of force majeure, a situation beyond its control, and it was covered in the agreement. It contended that the petitioners' were less than 10 percent of the total buyers, hence the petition was not maintainable.

While rejecting the plea, the tribunal maintained, "The corporate debtor entered a litigation with the government department. Therefore, it cannot be termed a force majeure clause. The hurdles stated in its reply, affidavits and written submissions, cannot be termed as force majeure or beyond its control.”

It said that such statutory compliances, including the No Objection Certificate and occupancy certificates, were part of the real estate projects.

The 29-page order read, “These hurdles are practical situations for which the corporate debtor has to come forward for the resolution and he cannot wipe off its liability by taking the defence of force majeure or illegitimate claims by appropriate authorities.”

Rahejas earlier faced insolvency proceedings in 2019 over a delay in its Raheja Sampada project. However, in 2020, it was set aside as the delay was on account of the absence of clearance by the competent authorities.

Advocate Aditya Parolia represented the association of Revanta, Vanya and Aranya projects of Raheja Developers.