Assets Care & Reconstruction Enterprise Ltd. vs Shyam Arora

The present Application has been filed by the Assets Care & Reconstruction Enterprise Ltd. (hereinafter referred to as “Applicant”), under sub-section (5) of section 60 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as the “Code”) read with Regulation 13 of IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 read with Rule 11 of the National Company Law Tribunal Rules, 2016 for acceptance of its claim of Rs. 20,99,10,060/- (Rs. Twenty Crore Ninety Nine Lakh Ten Thousand Sixty Only) owed by SRS Real Estate Limited (Corporate Debtor) which includes the Principal Amount along with interest and other charges. Through this Application, the Applicant is seeking the following reliefs:-

The averments made by the Applicant in its Application and presented/argued by the learned counsel for the Applicant are summarised hereunder:

In this context, the defence placed by the Respondent in its Affidavit in reply and submission made thereon and as presented/argued by the learned counsel for the Respondent are summarised as under:

In compliance with the Order dated 19.11.2025, an Affidavit was filed vide Diary No. 00727/40, wherein the Resolution Professional placed on record the background of the case along with copies of Orders passed in respect of other Financial Creditors on similar Applications, which had been rejected, namely Union Bank of India v. Shyam Arora, RP, IA No. 1800/2023, Order dated 14.05.2024, and Kamla Angrish v. SRS Real Estate Ltd., IA No. 1373/2024, Order dated 12.06.2024, being belated and non project specific claims.

Furthermore, vide Order dated 24.03.2026, this Adjudicating Authority directed the Ld. Counsels for both sides to file brief notes of arguments along with relevant judgments. In compliance thereof, short notes were filed by both parties, vide Diary No. 00727/39 by the Applicant and vide Diary No. 00727/41 by the Respondent.

We have considered the submissions made by the Learned Counsel appearing for both parties and have gone through the material available on record carefully, along with the extant provisions of the Code and the settled position of law on the subject issue.

In the present case, the CIRP of the Corporate Debtor was initiated vide Order dated 22.12.2022 in CP(IB)No.167/Chd/Hry/2020, which was specifically confined to the project, namely SRS Royal Hills Phase II, Sector-87, Faridabad. Pursuant to the Public Announcement issued in terms of Section 13 of the Code, read with Regulation 6 of the CIRP Regulations, claims were invited from stakeholders relating to the said project. The Resolution Plan for the said project was thereafter approved by the CoC on its 11th meeting held on 12.01.2024, and the same is pending consideration before this Adjudicating Authority. The Applicant filed its claim in Form C on 19.02.2025, i.e., after approval of the Resolution Plan by the CoC, resulting in a delay of 401 days from the date of CoC approval and 775 days from the last date stipulated under the Public Announcement. The Resolution Professional rejected the claim vide email dated 20.02.2025 on the grounds that the claim was filed belatedly after approval of the Resolution Plan and that the CIRP in the present matter was restricted to the SRS Royal Hills Phase II project, whereas the Applicant’s claim pertained to the Corporate Debtor generally and not to the said project.

It is further noted that only creditors whose claims were specifically relatable to the SRS Royal Hills Phase II project were permitted to participate in the CIRP. The loan disbursement relied upon by the Applicant does not disclose any project-specific linkage with the said project. Rather, the material placed on record indicates that 76 units mortgaged with the Applicant relate to SRS Residency, Sector 88, Faridabad, and not to the SRS Royal Hills Phase II project. The Applicant has also failed to produce any document demonstrating that the loan was extended exclusively or even partly for the said project.

The Applicant has sought to justify the delay on the ground of non-receipt of individual communication under Regulation 6A of the CIRP Regulations. Regulation 6A provides for the communication of the public announcement to creditors based on the last available books of accounts of the Corporate Debtor, while the proviso thereto clarifies that where such communication is not possible, the public announcement itself shall be deemed to be sufficient communication. In the present case, the public announcement was duly issued in widely circulated newspapers, thereby constituting deemed communication to all stakeholders, including the Applicant. Moreover, the CIRP in the present matter was confined to the SRS Royal Hills Phase II project and, therefore, communication under Regulation 6A was required only in respect of creditors pertaining to the said project, whereas the Applicant’s claim admittedly relates to the Corporate Debtor as a whole and not to the project under CIRP.

Regulation 12 of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 mandates that a creditor shall submit its claim with proof on or before the last date mentioned in the public announcement. The proviso to Regulation 12 of the said Regulation provides for the submission of claims within ninety days from the insolvency commencement date. Further, Regulations 13 (1B) and 13 (1C) of the said Regulation also provide for consideration of any belated claims that are filed after the period specified under Regulation 12(1) and upto 7 days before the date of the meeting of creditors for voting on the Resolution Plan. In the present case, not only had the extended period long expired, but the Resolution Plan had already been approved by the Committee of Creditors prior to the filing of the claim. As such, entertaining such a belated claim at this stage would unsettle the commercial decision already taken by the Committee of Creditors and would defeat the time-bound framework of the Code. Even otherwise, the claim also deserves rejection on the ground that the said debt does not pertain to the project under insolvency.

The Respondent has placed reliance upon the Hon’ble Supreme Court judgment in RPS Infrastructure Ltd. vs. Mukul Kumar (2023) 10 SCC 718, (11.09.2023), wherein it has been held that once a Resolution Plan is approved by the CoC, fresh or belated claims cannot be entertained. The rationale underlying the said decision is that permitting new claims after approval of the Resolution Plan would reopen the entire resolution process and disturb the commercial wisdom exercised by the Committee of Creditors, and open a Pandora’s box by inviting similarly placed creditors to seek admission of claims at a belated stage.

The Applicant has sought to rely upon the judgment of the Hon’ble Supreme Court in State Tax Officer v. Rainbow Papers Limited (2023) 9 SCC 545 to contend that delay in filing of claim cannot be the sole ground for rejection and that a secured creditor cannot be denied its status. The said judgment dealt with the status of a statutory authority as a Secured Creditor in the context of liquidation and the effect of a statutory charge. The issue in the present case is not the determination of the status of the Applicant as a Secured Creditor, but whether a claim filed after inordinate delay and after approval of the Resolution Plan by the Committee of Creditors can be directed to be admitted. The recognition of a creditor as secured does not dilute the mandatory timelines prescribed under the Code and the Regulations. Hence, the case relied on by the Applicant does not apply to the present case.

In view of the above discussion, we hold that RP has taken a correct decision while rejecting the claim of the Applicant.

Accordingly, IA(I.B.C)/582(CH)2025 in CP(IB)No.167/Chd/Hry/2020 stands dismissed and disposed of.