M/s. Omkara ARC Pvt. Ltd. vs M/s. Divya Infra Properties Pvt. Ltd.

Heard the Ld. Counsel for RP.

I.A. (IBC) Resolution Plan 14/2024 is approved vide separate order.

List the case on 15.07.2026 for reporting on implementation by monitoring committee.

Mr. Prakul Thadi (Resolution Professional of the Corporate Debtor’) has filed this application on 29.11.2024 under Section 30(6) read with Section 31 of the Insolvency and Bankruptcy Code, 2016 and Regulation 39(4) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 seeking approval of the Resolution Plan of the Corporate Debtor submitted by Mr. Venkataswamappa Raghu (Successful Resolution Applicant/SRA), and approved by the Committee of Creditors in its 16^th CoC meeting held on 06.11.2024 with 100% voting share.

Divya Infra Properties Private Limited, Corporate Debtor was admitted to undergo Corporate Insolvency Resolution Process vide order dated 31.10.2023 under Section 7 of IBC, 2016 for committing default in payment of debt amounting to Rs.47,59,12,611/- and Mr. Prakul Thadi (IBBI/IPA002/IP-N01149/2021-2022/13086) was appointed as the Interim Resolution Professional. Subsequently vide order dated 22.01.2024 passed in I.A. 26/2024, he was confirmed as the Resolution Professional of the Corporate Debtor.

The key dates and events during the Corporate Insolvency Resolution Process period are tabulated hereunder:

Registered Valuers were appointed on 15.12.2023, copy of valuation reports has been attached as Annexure H1 to H7, the summary of valuation reports of the Corporate Debtor is as follows:

This Resolution Plan has been proposed by Mr. Venkataswamappa Raghu. The SRA is involved in Construction of schools, owns a Gas Station and engages in other construction ventures. Following projects were started by the SRA:-

a. Jalahalli Education Society (JES)

b. Jalahalli Service Station (JSS)

c. Construction Ventures

d. Hari Hara Educational Trust

The Successful Resolution Applicant has a net-worth of INR 58,52,24,388.37/- as on 15.12.2025 and meets the criteria provided by the CoC and is also eligible under Section 29A of the Code, affidavit regarding the same is annexed as Annexure N in the main Petition along with the due diligence report under Regulation 36A(8) has been submitted as Appendix 1 to memo dated 18.08.24, diary no. 4520, confirming the eligibility of the SRA.

Clause 10 of the Resolution Plan deals with its feasibility and viability, highlighting that the Successful Resolution Applicant (SRA) has a strong financial standing, as evidenced by a Comfort Letter for a credit facility of INR 40,00,00,000 and The Successful Resolution Applicant has a net-worth of INR 58,52,24,388.37/- as on 15.12.2025 and the same is enclosed as Document No. 2 & 3 in compliance memo dated 09.01.2026 diary no. 70, thereby establishing its capacity to undertake the acquisition and turnaround of the Corporate Debtor. It is further submitted that the SRA has a proven track record of financial stability and operational management, demonstrating both the capability and commitment to fulfil its obligations under the Plan. The SRA’s readiness to promptly deploy necessary resources, coupled with its financial strength and relevant experience, provides adequate assurance of the Plan’s feasibility and long-term viability.

 Source of Funds: The SRA in clause 5.10 of the Resolution Plan, on pg. 41, has explained the source of funds and the same is reproduced below:

The Successful Resolution Applicant has a net-worth of INR 58,52,24,388.37/- as on 15.12.2025. Further Copy of comfort letter from Shri Bilur Gurubasava Credit Co-op Ltd Bagalkot for an amount of INR 40,00,00,000/- (Rupees Forty Crore only) is enclosed as Document No. 2 & 3 in compliance memo dated 09.01.2026 diary no. 70.  Performance Bank Guarantee: The SRA has furnished a bank guarantee for INR 2,00,00,000/- by ICICI Bank, which is valid up to 21.02.2028 and is attached as Appendix 4 to the Resolution Plan.

The Resolution Plan provides that the existing equity share shall be extinguished without any payment or recourse and the Successful Resolution Applicant, and its nominees remain the only shareholders of the Corporate Debtor. Further, out of the amount brought by the Resolution Applicant for payment of upfront amount to Financial Creditors, an amount of INR 10,00,000/- shall be satisfied by way of issue of fresh Equity Share Capital of the Corporate Debtor to the subscribers at its face value and post such Capital Infusion, the SRA shall own the entire paid-up share capital of the Corporate Debtor.

 Avoidance Transactions- As per Clause 12 of the Form H, the details of PUFE are as follows:

After the Approval Date, the SRA proposes to continue to contest the avoidance transactions, filed by the Resolution Professional under Chapter III or fraudulent or wrongful trading under Chapter VI of Part II of the Code and the proceeds from such proceedings shall be retained by the Resolution Applicant.

 Pending Litigation- The list of Pending Litigations against the Corporate Debtor has been attached in Clause 14 of the Form-H.

 IBBI Fee- Clause 11 of the Form H states that amount of regulatory fee payable to the Board under Regulation 31A of Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, is INR 6,41,287.04. Further, an affidavit to the said effect submitted by the SRA is annexed as Appendix 5.

Heard Sh. A.S. Vishwajit, Advocate, learned counsel for the RP/Applicant and carefully perused the pleadings on record.

On 21.01.2025, following order was passed:

In Applicant has filed compliance memo on 06.02.2025 and the same is taken on record.

Post commencement of CIRP, CoC was constituted by the RP. The details of the creditors, the distribution of voting share among them and the position of voting for the Resolution Plan is as under (Para 6 of Form H):

The details of stakeholders and the amounts provided for them under the Resolution Plan is given in Para 7B of Form H, given below:

(Amount In Rupees)

The compliance of the Resolution Plan as per Form H is hereunder:

At this juncture it is necessary to refer to Section 30(2) of IBC which is as follows:

The compliance of Section 30(2) of the Code is given in Annexure to Form-H (supra). The same is being further examined as under:

 one representative of the Secured Financial Creditor and  one representative of Financial Creditors in a class,  up to three representatives of the Resolution Applicant (with only one voting right), and  the Resolution Professional, Mr. Prakul Thadi, as an independent member During this period, the powers of the Board of Directors remain suspended, and are vested in the Monitoring Committee, whose decisions are taken by majority and are binding. The Committee is required to act in the best interests of the Corporate Debtor and assist the Resolution Applicant in obtaining necessary statutory approvals for commencement of construction. The Resolution Professional shall act as the Monitoring Agent, chair the meetings of the Monitoring Committee, and have a voting right therein. Further, prior to the Approval Date but after CoC approval of the Resolution Plan, the Resolution Applicant shall agree upon the fees, costs, and expenses of the Monitoring Committee (termed “Interim Management Costs”), which shall be borne and funded by the Resolution Applicant over and above the Resolution Amount.

During the Standstill Period, the Monitoring Committee shall be responsible for implementing all matters necessary for the successful execution of the Resolution Plan and must provide information on such implementation as reasonably requested by the Resolution Applicant. The existing Monitoring Committee shall stand dissolved upon the Effective Date, following which a Reconstituted Monitoring Committee comprising two representatives of Financial Creditors in a class and three representatives of the Resolution Applicant shall be formed, which will thereafter supervise the continued implementation of the Resolution Plan, including completion of the project construction as envisaged.

Regulation 38(1): The amount offered to Operational Creditor under the Plan has been laid down below:

Regulation 38(1A): The Resolution Applicant has considered the interest of all the stakeholders and has accordingly proposed to make payment to the stakeholders in the following manner:

Note A- The Resolution Plan provides for completion of the pending construction within 2 years, with an additional grace period of 1 year, and delivery of units to homebuyers upon payment of the outstanding sale consideration along with an additional ₹950 per sq. ft. towards cost escalation due to inflation and increased construction expenses. In case a homebuyer fails to make these payments, the Resolution Applicant proposes to refund the entire booking amount paid as per the agreement of sale.

Note B- The Resolution Plan provides that claims of Other Creditors, primarily relating to completion of amenities in the Tulip Block, shall be addressed by completing the pending construction and finishing of such amenities, with the associated costs to be borne by the residents of the Tulip Block or their association in proportion to their respective flats. The Resolution Applicant shall facilitate this process without incurring any cost, except for waiving professional fees for completion of the amenities, and no separate payments or settlements are proposed for Other Creditors.

Regulation 38(1B): The SRA has states in Clause 2.6(e) of the Resolution Plan that as mandated under Regulation 38(1B) of the CIRP Regulations, the Resolution Applicant confirms that as on date the Resolution Applicant or any of its related parties has not failed to implement or contributed to the failure of implementation of any Resolution Plan approved under the code.

Regulation 38(3)(a): Clause 4.1 at of the Plan states that the defaults of Divya Infra Properties Private Limited were primarily caused by a severe liquidity crunch arising from heavy dependence on debt financing and restricted access to funding, which disrupted cash flows and operations. This was compounded by significant project delays due to regulatory hurdles, land acquisition issues, and construction setbacks, which strained finances and eroded buyer confidence. High levels of borrowing coupled with slow sales created a debt trap, while regulatory changes such as RERA, GST, and demonetization increased compliance costs and uncertainty. Additionally, a broader market slowdown led to reduced demand, inventory pile-up, and declining profitability. Ongoing litigation and disputes over land titles, clearances, and buyer grievances further drained resources and delayed execution. Weak corporate governance practices also undermined investor and lender confidence, while regional oversupply intensified competition and compressed margins, collectively contributing to the company’s financial distress.

Regulation 38(3)(b): Clauses 4.2 & 4.3 of the Plan summarise the rationale of the Resolution Plan and Resolution Plan strategy. Along with this Clause 10 of the Resolution Plan deals with its feasibility and viability, highlighting that the SRA has a strong financial standing, as evidenced by a Comfort Letter for a credit facility of INR 40,00,00,000 and a Net Worth Certificate reflecting a net worth of 58,52,24,388.37/- as on 15.12.2025, thereby establishing its capacity to undertake the acquisition and turnaround of the Corporate Debtor.

Regulation 38(3)(c): Clause 6.9.2 provides for the indicative timeline for implementation, which is reproduced below:

Regulation 38(3)(d): The time-line for approvals of Resolution Plan is stated in Clause 8.1.26 of the Resolution Plan, reproduced below:

Regulation 38(3)(e): The SRA has a strong financial standing, as evidenced by a Comfort Letter for a credit facility of INR 40,00,00,000 issued and also has a net-worth of INR 58,52,24,388.37/- as on 15.12.2025 thereby establishing its capacity to undertake the acquisition and turnaround of the Corporate Debtor. It is further submitted that the SRA has a proven track record of financial stability and operational management, demonstrating both the capability and commitment to fulfil its obligations under the Plan.

HOME-BUYERS DETAILS:

a. List of Homebuyers: As per memo filed dated 16.04.26, diary no. 1890, is reproduced below:

b. Payment Timeline for the Homebuyers: The balance sale consideration together with an additional payment of INR 950/- per sq. ft. shall be deposited in the following tranches:

 X shall mean “aggregate of balance sale consideration as per the agreement of sale entered into by the Corporate Debtor with the respective homebuyers together with an additional payment of INR 950/- per sq. ft.”

c. Grace Period for Homebuyers payment: The Affidavit dated 06.04.2026 by the SRA filed as Annexure A in Memo with diary no.1890 dated 16.04.2026, states that a grace period of one month is provided for every tranche from the deadline for respective tranche payment provided in the Plan. Further, in the event of failure of any of the homebuyers to deposit the aforementioned tranches of payment, the allotment of flat in the name of the respective homebuyer shall be deemed to have been cancelled and the homebuyer shall be entitled to refund of the entire booking amount (i.e. the amount paid by them as acknowledged in the agreement of sale entered into between such homebuyer and the Corporate Debtor) as well as the amounts, if any, paid in accordance with the aforementioned tranches, within thirty days from the due date for deposit of tranche amount. In the event of failure to refund such amounts within the said period of thirty days, the Successful Resolution Applicant shall be liable to pay interest in terms of para 20(vi) of this Order, from the expiry of the said thirty-day period until the date of actual payment.

The Resolution Professional has certified that the Resolution Plan is not subject to any contingency in Para 16 of Form-H. Further, in Para 2 it is certified that the Resolution Plan complies with all the provisions of Insolvency and Bankruptcy Code, 2016 and the Regulations thereunder and also does not contravene any of the provisions of the law for the time being in force. Further, the SRA has submitted an affidavit under section 30(1) of the Code confirming its eligibility under Section 29A of the Code to submit the Resolution Plan. It is further certified that the Resolution Plan has been approved by the CoC in accordance with the provisions of the Code and the CIRP Regulations made thereunder. The Resolution Plan has been approved with 100% vote share after considering all the requirements specified by the CIRP Regulations.

Reliefs and Concessions: In Clause 8 of the Plan, the Resolution Applicant has urged for exemption of compliance in relation to Companies Act, 2013, Taxes (Direct & Indirect) & Stamp Duty as well as Specific Laws, other Government Approvals as applicable to the Corporate Debtor. The Prayer has been examined and it is observed that for such reliefs and exemptions, the Resolution Applicant will have to approach the respective statutory authorities for being accorded and decided as per the provisions of concerned existing laws and landmark judgements. Further, the approval of the Resolution Plan shall not in itself be construed as waiver of any statutory obligations/liabilities and any waiver sought in the Resolution Plan, shall be subject to approval by the Authorities concerned in light of the Judgment of Supreme Court in Ghanshyam Mishra and Sons Private Limited v/s. Edelweiss Asset Reconstruction Company Limited (Civil Appeal no. 8129 of 2019).

It must be noted that the Resolution Professional and the Successful Resolution Applicant have filed affidavits dated 06.08.2025 and 16.10.2025 in relation to Apartment Nos. 605 and 607, stating that I.A. No. 510 of 2024 has been filed as an avoidance transaction application concerning alleged fraudulent transactions involving various respondents. It is, however, clarified that the Resolution Plan is structured to remain viable and implementable independent of the outcome of any title dispute pertaining to the said apartments, and such disputed status does not in any manner affect or undermine the feasibility or success of the Resolution Plan.

DECISION OF THE ADJUDICATING AUTHORITY: In the circumstances and for the aforesaid reasons, the application bearing I.A. (Plan) No. 14 of 2024 is allowed and accordingly:

a. The moratorium imposed vide order dated 31.10.2023 in the main Company Petition ceases to operate from the date of this order.

b. The resolution professional shall forward all records relating to the conduct of the CIRP and the Resolution Plan to the Board to be recorded/uploaded on its database.