Manoj Kumar (Proprietor M/s Volunteer Associates) vs Sarv Awas Housing Bhiwadi Private Limited

The present Application has been filed on 22.12.2024 by Mr. Parminder Singh Bhullar, Resolution Professional (hereinafter referred to as the “RP”) under Sections 30(6) of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as the “Code” or “IBC”), read with Regulation 39(4) Of the Insolvency And Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 (hereinafter referred to as the “CIRP Regulations”) and Rule 11 of the National Company Law Tribunal Rules, 2016, for seeking approval of the Resolution Plan by Consortium of Sh. Rawal Ram and Sh. Sanjeev Chadha (hereinafter referred to as the “Successful Resolution Applicant” or “SRA”), in respect of Sarv Awas Housing Bhiwadi Private Limited (hereinafter referred to as the “Corporate Debtor”) which has been approved with a 100% voting share of the Committee of Creditors (hereinafter referred to as the “CoC”) in its 13th CoC meeting held on 24.11.2024.

The averments made by the Applicant/Resolution professional in the present application and as argued by the Learned Counsel are summarized as under:

The valuers arrived at Fair value and Liquidation value as under:

On that basis, the average of the Fair value and Liquidation value amounted to Rs. 8,15,69,682 and Rs. 6,73,69,529 respectively.

During the course of hearing on 14.07.2025, this Adjudicating Authority took note of the submission that the Corporate Debtor was engaged in a real-estate project involving construction of approximately 900 flats and that 237 claims had been admitted and considered under the Resolution Plan. The Plan proposes to complete the construction of the project and to deliver possession of the flats to the respective claimants, subject to payment of outstanding dues along with cost escalation of 30% in the original rates. Considering the nature of the project and the proposed treatment of stakeholders under the Resolution Plan, the Resolution Professional was directed to clarify whether the sales reflected in the books of accounts and other records exceeded the number of 237 claims included in the Resolution Plan. The Resolution Professional was further directed to place on record a brief note indicating the number of towers comprising the project, the total number of flats therein and the stage of completion of the project at the commencement of CIRP.

In compliance with the above order dated 14.07.2025, the RP filed an affidavit giving following details

During the course of hearing on 21.07.2025, this Adjudicating Authority considered the compliance affidavit filed by the Resolution Professional pursuant to the earlier directions of the Bench. From the material placed on record, it was noted that out of 900 units in the project, 571 units had been sold prior to commencement of CIRP, whereas claims had been filed by only 237 allottees in whose favour allotments had been made and/or Builder Buyer Agreements had been executed. It was further noticed that 54 persons, from whom only token amounts had been received without execution of any application form, allotment letter or Builder Buyer Agreement, had filed claims and were treated under the Resolution Plan as “Other Creditors”. The Bench also took note of the existence of another 248 similarly situated persons who had paid token amounts but had not filed claims during the CIRP. In these circumstances, the Resolution Professional was directed to explain the differential treatment proposed under the Resolution Plan and to place on record the details of such persons. In compliance of the above, the RP filed an affidavit stating the following:

The Bench also observed that there had been a change in the consortium of the Successful Resolution Applicant and directed the RP to clarify whether such a change was permissible post-publication of the final list of PRAs. The RP submitted that the Resolution Plan was submitted by 'Consortium of Rawal and Chadha' wherein the consortium member Mr. Rawal Ram was replaced by his nephew, Mr. Prem Khileri, a related party and as such the Consortium is the same.

During the hearing, it was noted that the Income Tax Department(ITD) has filed a claim of Rs. 4.19 crore. The RP submitted that the claim was filed belatedly on 24.04.2025, much after CoC approval was made on 24.11.2024. The RP submits that such belated claims cannot be entertained as they would derail the CIRP, prejudice the stakeholders, and jeopardize the viability of the Resolution Plan. The RP also clarified that in response to his query dated 07.11.2024 regarding the treatment of statutory claims, the SRA had proposed to pay 5% of the amount, if any such claim is received before approval of the Resolution Plan by the Adjudicating Authority.

During the course of hearing on 01.08.2025, this Adjudicating Authority considered the compliance affidavit filed by the Resolution Professional pursuant to the earlier directions of the Bench. It was brought to the notice of this Adjudicating Authority that the Successful Resolution Applicant had, by way of an affidavit, proposed to extend the same treatment to the 248 persons who had merely paid booking amounts and had not filed claims during the CIRP as was proposed for the 54 creditors who had filed claims. It was further submitted on behalf of the Income Tax Department that, although its claim had been filed belatedly, the underlying demand had been communicated to the Resolution Professional during the CIRP and had also been referred to in proceedings concerning revival of the struck-off Corporate Debtor. Upon consideration of the submissions and material placed on record, this Adjudicating Authority observed that the Resolution Professional had advised the Income Tax Department to file its claim in the prescribed form, however the same had not been done and the claim came to be filed only after approval of the Resolution Plan by the Committee of Creditors. Nevertheless, considering the proposals placed through the respective affidavits, this Adjudicating Authority directed that suitable provisions be incorporated in the Resolution Plan by way of an addendum and be placed before the Committee of Creditors for consideration and approval and thereafter before this Adjudicating Authority for further consideration.

While the discipline of timelines under the CIRP process cannot be compromised by indiscriminate admission of delayed claims, statutory authorities nevertheless remain stakeholders under the Code and their dues, when brought to the notice of the RP during CIRP, require due consideration.

As a result thereof, the RP filed an affidavit placing on record stating that the Resolution Applicant submitted an Addendum to the Resolution Plan on 07.08.2025. The addendum was proposed in order to address the concerns noted by this Adjudicating Authority regarding the treatment of statutory dues intimated by the Income Tax Department during the CIRP as well as the treatment of 248 creditors who had paid token amounts towards advance registration of units but had not filed claims during the CIRP. Under the addendum, a provision was made towards the claim of the Income Tax Department and the aforesaid category of 248 persons was also granted treatment at par with the category of 54 admitted “other creditors”. The addendum was thereafter placed before the Committee of Creditors in its meeting held on 11.08.2025. After discussion, the matter was put to voting, which was concluded on 16.08.2025 and the same was approved with 100% voting in favour. The RP annexed the Addendum to the Resolution Plan approved by the CoC, and the Amended/Revised Form H dated 20.08.2025.

As per the Addendum to the Resolution Plan submitted by the Successful Resolution Applicant and approved by the Committee of Creditors, provision has been made for payment of 5% of the claim amount towards the dues of the Income Tax Department. Further, the 54 admitted “Other Creditors”, comprising persons who had paid token amounts towards advance registration of units, have been proposed to be paid 50% of their admitted claims. The Addendum further extends similar treatment to 248 persons who had paid token amounts towards advance registration of units but had not filed claims during the CIRP, by providing payment of 50% of the principal amount reflected in the records of the Corporate Debtor and treating them at par with the aforesaid category of Other Creditors. Consequently, an additional amount of Rs. 20,98,078/- has been earmarked towards the claim of the Income Tax Department as against their claim of Rs. 4.19 crore and a further amount of Rs. 2,43,18,916/- has been provided towards the aforesaid category of 248 creditors as against aggregate amount received from the said 248 persons, as reflected in the records of the Corporate Debtor, which is Rs. 4,86,37,832/- . Resultantly, the total financial outlay under the Resolution Plan stood enhanced from Rs. 16,94,93,384/- (including CIRP costs of Rs. 2,01,11,656/-) to Rs. 19,60,65,376.75/-. The financial outlay as mentioned in the addendum to the Resolution plan and Fresh Form H filed with previous and enhanced proposals is shown in the table given below.

It is pertinent to note that during the course of consideration of the Resolution Plan this Adjudicating Authority vide order dated 26.11.2025 observed that, the valuation reports placed on record reveal that the valuers have considered only a limited number of unsold units while assessing the Fair Market Value and Liquidation Value of the assets of the Corporate Debtor. As per the material available on record, the project comprised a substantially larger number of residential units, however, the valuation exercise was confined only to certain units shown as unsold on the basis of information furnished by the Resolution Professional. It has further emerged during the course of proceedings that several units, though initially treated as sold/booked, were not backed by allotment letters or Builder Buyer Agreements and only token amounts had been received in respect thereof. Consequently, the actual inventory of unsold units appears to be considerably higher than what was taken into account by the registered valuers.

In these circumstances, this Adjudicating Authority found that the valuation reports did not capture the complete asset base of the Corporate Debtor and, therefore, fresh valuation of the entire project/assets was directed to be undertaken so as to ensure compliance with the provisions of the Code and to arrive at a proper determination of the liquidation value and fair market value. It was also observed that while examining compliance under Section 30(2)(b) of the Code, the Resolution Professional was required to take into consideration the dues of statutory authorities, including the Income Tax Department, where such claims/intimations had been made available during the CIRP period, irrespective of delay in filing the claim in prescribed format.

Pursuant to the directions issued by this Adjudicating Authority vide order dated 26.11.2025, the Resolution Professional filed a compliance affidavit stating that fresh valuation of the entire assets of the Corporate Debtor was undertaken after approval of the Committee of Creditors in its 21st meeting held on 06.12.2025. In terms thereof, two new registered valuers, namely M/s Bizxpert Valuation Services Private Limited and M/s Axiology Valuetech Private Limited, were appointed to conduct valuation of the entire assets of the Corporate Debtor.

The fresh valuation exercise assessed the average Fair Market Value at Rs. 21,02,24,968/- and the average Liquidation Value at Rs. 15,27,41,925/-. The CoC, in its subsequent meeting, noted that the Resolution Plan value remained higher than the revised liquidation value. The compliance was placed on record with a fresh valuation report filed as Annexure A-3 with the Application and a chart illustrating compliance of Section 30(2) was also placed on record as Annexure A-5 with the Application.

It was observed that, by way of an addendum to the Resolution Plan dated 08.04.2026, provision was made for those allottees holding decrees issued by RERA, with a stipulation that such decree-holders shall be treated at par with the other claimant-allottees i.e. Homebuyers. In the 24th CoC meeting, RP placed the Addendum dated 08.04.2026 before CoC; after deliberations, CoC unanimously resolved (100% voting in favour) to approve the new Addendum and to treat it as an integral part of the Resolution Plan dated 15.10.2024.

In the backdrop of aforesaid facts and the addendums, before considering the Resolution Plan for approval, we consider it appropriate to list the salient features and proposals as made by the SRA through the Resolution Plan:

a. Initiated & Sold Part-The RA proposes to complete the initiated portion of the project within 42 months from the Effective Date, including 9 months for obtaining statutory approvals (from Urban Development Trust/RERA/Pollution Control Board, etc.) and 3 months for completion and occupation certificates. Allottees shall pay an escalation of 30% of the Basic Sale Price (BSP) as mentioned in their buyer-developer agreements or allotment letters. Any pending principal amount, including escalation, must be paid within 120 days from the Effective Date. Possession shall be offered after receipt of completion and occupation certificates, which shall be deemed the Implementation Date of the Resolution Plan. A one-year window will remain open for registration of flats after issuance of offer letters. All registration expenses shall be borne by the allottees. The RA will charge ₹50,000 per unit for any further transfer of the unit by an allottee.

b. Refund Option to Allottees: Allottees opting for refund shall be paid the principal amount only, without interest, damages, assured returns, or pre-EMI/award amounts. Refund applications must be made within three months from the Effective Date with requisite documents (allotment letter, receipts, BBA/agreement to sell, KYC, NOC from lender, etc.). Upon submission of a refund application, the allottee’s rights over the unit shall stand extinguished, and the RA shall be free to deal with the unit. Refunds shall be processed within one month of application and paid in three equal installments — at 60, 90, and 120 days, respectively. The SRA in its plan vide an addendum filed through an affidavit has stated that In case any allottee fails to apply for the refund within three months from the effective date as mentioned above then that allottee shall be eligible to take the possession of the units as per clause h (i) by paying principal amount due along with the escalation of 30%.

c. Non-Initiated & Unsold Part-The RA shall have complete discretion over all unsold units, including the right to sell or otherwise deal with them without any liability. The non-initiated portion will also be completed within 42 months from the Effective Date, with the same timeline for statutory approvals and occupation certificates. Offer of possession and registration window shall follow the same terms as for the initiated portion. Registration expenses and ₹50,000 per-unit transfer charges shall similarly apply. In accordance with Section 14 of RERA, 2016, any alterations or additions to the sanctioned layout or building plans shall be deemed approved by all existing allottees upon approval of this Resolution Plan. In case of delay in obtaining requisite approvals beyond 9 months, the RA may seek extension of implementation period from the Adjudicating Authority. The implementation of the Resolution Plan shall be deemed complete on the last date of offer of possession issued by the RA

We have heard the Learned Counsel for the RP and have carefully pursued all the pleadings placed on the records. It is noted that the CoC approved the Resolution Plan of the Consortium of Sh. Rawal Ram and Sh. Sanjeev Chadha by 100% votes and as such it is not necessary for us to go into details of the commercial wisdom of CoC. We proceed to examine the plan in light of provisions contained in sections 30(2) and 31 of the Code r.w. Regulation 38 of the IBBI (CIRP of the Corporate Debtor) Regulations, 2016. The resolution professional has produced on record the compliance certificate in Form-H. The revised fair value of the assets of the corporate debtor is at Rs. 21,02,24,968/- whereas, the liquidation value of the corporate debtor is Rs. 15,27,41,925/-. The plan value as proposed by the successful resolution applicant is Rs 28,37,71,446. The Successful Resolution Applicant has submitted an affidavit of eligibility under section 29A of the Code as per Annexure A-23.

In order to obtain the approval of the Adjudicating Authority, the Resolution Plan should adhere to the following requirements as per section 30(2) of the Code and Regulation 38 of the CIRP Regulations thereunder::

Such other requirements of the Resolution Plan as detailed in IBBI (Resolution Process for Corporate Person) Regulations, 2016 which are not covered above, are as under:

a. The Resolution Plan should include a statement as to how it has dealt with the interest of all stakeholders including financial creditors and operational creditors of the corporate debtor. [CIRP Regulation 38 (1A)]

b. The Resolution Plan should include a statement giving details as to whether the resolution applicant or any of its related parties has at any time failed to implement or caused the failure of implementation of any other Resolution Plan which was approved by the Adjudicating Authority. [CIRP Regulation 38 (1B)]

c. The Resolution Plan should contain the term of the plan and its implementation schedule. [CIRP Regulation 38(2)(a)]

d. The Resolution Plan should also demonstrate that it addresses the cause of default; is feasible and viable; has provisions for its effective implementation; has provisions for approval required and timeline for the same. Further, that the resolution applicant has the capability to implement the Resolution Plan. [CIRP Regulation 38(3)]

In view of the above provisions of the Code, the Resolution Plan submitted before us has been examined as follows:

In view thereof, provisions of section 30(2)(b) of the code read with the CIRP Regulation 38(1)(a) & 38(1)(b) are complied with.

a. The Resolution Applicant confirms that it has considered interests of all stakeholders and has provided for payment/ repayment/ settlement of all stakeholders keeping in view the objective of the Company as a going concern, maximization of value and adhering to the requirements set out under the Code. The Resolution Plan adequately deals with the interest of all stakeholders, including financial creditors and operational creditors of the corporate debtor. Thereby, the plan is in compliance with CIRP Regulation 38(1A).

b. It is submitted that the Resolution Applicant hereby confirms that neither the Resolution Applicant nor any of its related parties have ever failed or ever contributed to the failure of implementation of any other Resolution Plan approved by the Adjudicating Authority at any time in the past. Thereby, the plan is in compliance with CIRP Regulation 38(1B).

c. The term of the Resolution Plan and its implementation schedule is given in Part C Section 2 Clause (v), Page 37-38 of the Resolution plan reproduced below

Thereby, CIRP Regulation 38(2)(a) has been complied with.

d. The Resolution Plan addresses the cause of default; is feasible and viable; has provisions for its effective implementation; contains provisions for approval required and the timeline for the same. Further, that the resolution applicant has the capability to implement the Resolution Plan. Thus, CIRP Regulation 38(3) has been complied with.

The Resolution Applicants possess experience in real estate, trading and allied commercial sectors and have demonstrated financial capability through their disclosed net worth and funding arrangements.

The source of fund for the total Infusion shall be from owned sources and internal accruals.

The Resolution Applicant has sought various reliefs, waivers, concessions and directions in the Resolution Plan at Part D Section 1 Clause xii in relation to, inter alia, (i) transfer and vesting of the assets, properties, records and business of the Corporate Debtor; (ii) continuation and restoration of utility services; (iii) extinguishment of claims, demands, penalties, interest, prosecutions and liabilities pertaining to the period prior to the Effective Date; (iv) treatment of direct and indirect tax liabilities, carry forward and set-off of losses and pending proceedings; (v) statutory and regulatory compliances under applicable laws; and (vi) such other approvals, permissions, exemptions and concessions as may be necessary for effective implementation of the Resolution Plan etc. We have considered the prayers so made as regards to Relief and Waivers as sought for and stated in Part D of the Resolution Plan. We have also considered the treatment proposed under the Resolution Plan in respect of claims not forming part of the Resolution Plan and liabilities pertaining to the period prior to the Effective Date.

As far as reliefs and concessions claimed by the resolution applicant with respect to the unpaid liabilities after the approval of the plan and the claims not filed at all with the RP during the CIRP, shall get extinguished. Reliance is also placed on the judgement of the Hon’ble Supreme Court in the case of Ghanshyam Mishra and Sons Private Limited Vs. Edelweiss Asset Reconstruction Company Limited and Ors. Reported in MANU/SC/0273/2021 in the following words:

In view of the above, all unpaid liabilities and those which are not included in the said Resolution Plan would stand extinguished.

After the corporate debtor is taken over by the new management, no inquiry, investigation, litigation etc. will be made against the taken over company in relation to the period prior to the CIRP.

As regards allowing carryforward losses, it is to be noted that following the process of the CIRP and on extinguishment of the unpaid liabilities, the financial accounts are to be recasted by providing suitable accounting entries whereby the extinguished liabilities, together with the extinguished share capital of the previous management, would get converted into the Capital/General Reserve, and as such, the accumulated losses, if any, will have to be, first of all, set off against such a reserve. For the balance amount, if any, the SRA can approach the Income Tax Authorities.

As regards other reliefs and concessions sought by the resolution applicant, we direct the said successful resolution applicant to approach the concerned statutory authorities for those concessions and those authorities will consider the same as per the provisions of law under the relevant Acts keeping in view the intent and object of the IBC.

The relief which is not specifically provided should not be treated as being allowed. Even if no reliefs or concessions are granted by the authorities concerned then also SRA is bound to implement the Resolution Plan effectively without taking shelter of refusal by authorities concerned by non-implementation of the plan.

In the view of the above discussion, this Adjudicating Authority is satisfied that the Resolution Plan has provisions for its effective implementation. Hence, we being satisfied, hereby accord our approval on the Resolution Plan along with its addendum as approved and recommended by the CoC and submitted by Mr. Parminder Singh Bhullar, RP for the corporate debtor with the following directions:

As a result, the Application bearing IA(IBC)(PLAN)20/2024 stands allowed.