CIRP petition by homebuyers under Section 7 IBC dismissed for failing 10% allottee threshold in undivided real estate project of 315 units and procedural defects including invalid authorisations and absent verifying affidavit.

O R D E R

Per Radhakrishna Sreepada, Member (Technical):

1. The present Petition was filed under Section 7 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as the IBC or the Code) read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules,2016, on 27.07.2021 by Shri Anup Tripathi & 38 Others seeking initiation of the CIRP against M/s. Nandhini Hotels Pvt. Ltd (hereinafter referred to as ‘Respondent / Corporate Debtor’. The Respondent Company - the Corporate Debtor, was incorporated on 10.05.1991 with CIN No. U55209KA1991PTC011956 with its registered office situated at #114/2, Lalbagh Fort Road, Bengaluru-560004. The total Amount due as on 31.05.2024 was ₹14,36,36,462.71/- (Rupees Fourteen Crores Thirty- Six Lakhs Thirty-Six Thousand Four Hundred Sixty-Two and Paise Seventy-One only). The Date of Default is stated as 12.06.2022, as mentioned in Part IV of Form 1 filed along with the Petition.

2. This ‘Adjudicating Authority’ (`National Company Law Tribunal’, Bengaluru Bench), admitted the Corporate Debtor in to CIRP vide order dated 20.10.2022.

a. The Respondent filed an appeal before the Hon’ble NCLAT against the impugned order dated 20.10.2022. The Hon’ble NCLAT vide its order dated 17.03.2023 allowed the appeal filed with the following Observations:

a. Prima-facie and looking to the provisions of the I & B Code, 2016, the ‘impugned order’, on this `particular issue of defects’, cannot be `allowed’, and therefore, the ‘impugned order’ dated 20.10.2022 in CP No. 122/BB/2021, passed by the `Adjudicating Authority’ (`National Company Law Tribunal’), Bengaluru Bench, on this score alone, deserves to be `set aside’, and accordingly is `set aside’, to `secure the ends of Justice’.

b. Since, the ‘impugned order’, is found to be on wrong side, on the basic issue, this ‘Appellate Tribunal’, is not inclined to delve deep into the other issues, as mentioned Supra, in Para 23.

c. This ‘Tribunal’, relevantly points out that it is not expressing its opinion on the `merits’ or `demerits’ of the case, and hence, remits back the case to the ‘Adjudicating Authority’ (`Tribunal’), with directions to look into all factual and legal aspects and decide the `Petition’ Denovo, on `merits’, by providing, `adequate opportunity’ of `Hearing’, to the respective `Parties’, and also, by adhering to the `Principles of Natural Justice’. It is reiterated that the ‘Adjudicating Authority’, shall decide on the `merits’ of the main `Petition’, in a `Fair’, `Just’, in a `Dispassionate Manner’, by passing a `Speaking Reasoned Order’ (in qualitative and quantitative terms), preferably within `twelve weeks’ from today, of course, uninfluenced and untrammelled with any of the `Observations’, made by this `Tribunal’.

b. The Petitioners herein filed an appeal in the Hon’ble Supreme Court, against the order passed by the National Company Law Appellate Tribunal (NCLAT), Chennai Bench in Company Appeal (AT) (CH) (INS) No. 417 of 2022 dated 17.03.2023.

c. The Hon’ble Supreme Court vide its order dated 25.08.2025 held that,

“While issuing notice on 21.07.2023, this Court indicated that the decision of the NCLAT, in the order impugned before us, to remand the matter to the National Company Law Tribunal may be a futile exercise. Unfortunately, two years have already passed and there i