IMPORTANT POINT
Consumer complaint – Scope of moratorium under Section 14 of IBC is statutory – Moratorium operates against corporate debtor alone.

JUDGMENT :

VIKRAM NATH, J.

1. The present civil appeals arise out of the judgment and order dated 20.01.2025 passed by National Consumer Disputes Redressal Commission¹[Hereinafter referred to as NCDRC.] in I.A. No. 15656 of 2024 and I.A. No. 14200 of 2024 in Consumer Complaint No. 13 of 2023, whereby the NCDRC rejected the applications seeking continuation of consumer complaint against Respondent Nos. 2 to 7 in view of the moratorium imposed against Respondent No.1 under Section 14 of Insolvency and Bankruptcy Code, 2016²[Hereinafter referred to as IBC.], and adjourned the complaint sine die.

2. The facts giving rise to the present appeals are as follows:

2.1. The appellants are homebuyers who had booked residential apartments in a project namely ‘Mantri Manyata Energia’ which was being developed by Respondent No. 1, Mantri Technology Constellations Private Limited (now known as Buoyant Technology Constellations Private Limited). Respondent No. 2, Mantri Developers Pvt. Ltd. is a company alleged to have been associated with the development of the said project. Respondent Nos. 3 to 5 are alleged to be the promoters/ directors of Respondent No. 1 and 2 companies, while Respondent No.6 and 7 are the landowners of the project land. Pursuant to the transaction, construction agreements and agreements for sale in respect of undivided share in the project land came to be executed between the appellants and Respondent No. 1 in 2016. As per the terms of the agreement, possession of the apartments was to be handed over on or before 31.12.2018.

2.2. According to the appellants, despite substantial payment of the sale consideration coupled with repeated assurances regarding completion of the project, possession of the apartments was not delivered within the stipulated time. Aggrieved thereby, the appellants, along with other homebuyers instituted Consumer Case No. 13 of 2023 before NCDRC alleging deficiency in service and unfair trade practices against Respondent Nos. 1 to 7.

2.3. During the pendency of the consumer complaint, the National Company Law Tribunal³[Hereinafter referred to as NCLT.], Bengaluru Bench, by an order dated 23.08.2024, admitted an application under Section 9 of the IBC against Respondent No.1 and initiated the Corporate Insolvency Resolution Process (for short, CIRP) as a result of which a moratorium under Section 14 of the IBC came to be imposed against Respondent No.1.

2.4. In view of the subsequent development, the appellants filed I.A. No. 14200 of 2024 before the NCDRC, placing the order of the NCLT and praying that notwithstanding the moratorium operating against Respondent No.1, the consumer complaint be reheard and proceeded with against Respondent Nos. 2 to 7.

2.5. Thereafter, the appellants filed I.A. No. 15656 of 2024 seeking rehearing of I.A. No. 14200 of 2024 and reiterating their prayer for continuing the hearing of the consumer complaint against the rest of the respondents.

2.6. By the impugned order dated 20.01.2025, the NCDRC rejected the aforesaid applications holding, inter alia, that the liability of Respondent Nos. 2 to 7 could not be independently examined at that stage in view of the moratorium operating against Respondent No.1, and consequently adjourned the consumer complaint sine die.

2.7. It is this order which is being assailed before us.

3. We have heard learned counsel for the appellants, Mr. D. Seshadri Naidu, learned senior counsel appearing for respondent No. 2, Mr. Sajan Povayya, learned senior counsel appearing for respondent No. 6 and 7, Mr. Shekhar G Devasa, learned senior counsel appearing for respondent No. 3, 4 and 5 and Mr. Ashutosh Dubey, learned counsel appearing for respondent No. 1.

4. After examining the material placed on record, it can be concluded that the issue involved before us lies in a narrow compass. The limited question is whether the NCDRC was justified in rejecting the IAs filed by the appellants on account of the moratorium operating against Respondent No.1.

5. In order