Surinder Aggarwal & Ors. vs M/s Raheja Developers Limited

The present petition is filed by Surinder Aggarwal & 175 others (“Financial Creditors”/“FC”/“Petitioners”), before this Adjudicating Authority on 12.04.2024 under Section 7 of the Insolvency and Bankruptcy Code, 2016 (“Code”), r/w Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 for initiating the Corporate Insolvency Resolution Process (“CIRP”), declaring moratorium and for appointment of Interim Resolution Professional (“IRP”), against M/s Raheja Developers Limited the Corporate Debtor (“CD”).

The relevant background relating to the CD, along with the details of the earlier admission orders, is briefly stated as follows:

In view of the above factual backdrop, it is evident that the present proceedings remained pending awaiting clarification from the Hon’ble NCLAT regarding project-specific CIRP proceedings against the Corporate Debtor. It was vide order dated 20.03.2026 that the Hon’ble NCLAT gave liberty to the homebuyers/allotees of other projects to pursue their proceedings under Section 7 against the CD with reference to their project.

Details of the petitioners (176 in number) have been given on pages 2 to 32 of the petition. The petitioners hold 99 Units in the project Raheja’s Revanta situated at Sector 78, Gurgaon, being constructed and developed by M/s Raheja Developers Ltd.

M/s Raheja Developers Limited was incorporated on 27.11.1990 under the provisions of the Companies Act, 1956, bearing CIN: U45400DL1990PLC042200. The registered address of the Corporate Debtor is W4D, 204/5, Keshav Kunj Cariappa Marg, Western Avenue, Sainik Farms, South Delhi, New Delhi – 110062.

Since the registered office of the Corporate Debtor is in New Delhi, this Tribunal, having territorial jurisdiction over the NCT of Delhi, is the Adjudicating Authority in relation to the prayer for initiation of Corporate Insolvency Resolution Process (CIRP) in respect of respondent/ corporate debtor under sub-section (1) of Section 60 of the Code.

In 2011, the Corporate Debtor launched its project named Raheja Revanta, admeasuring 18.7213 acres with representation and promises for the highest standard of living, great amenities, and timely delivery of possession of flats to the allottees.

Relying upon the aforesaid promises, the Financial Creditors expressed their willingness to book units in the Impugned Project, executed the requisite application forms, and made payments on the subsequent dates. Thereafter, the Corporate Debtor issued allotment letters in favour of the Financial Creditors in respect of various units during the period from around 2011 to 2020. (Annexure P-2 and P-3 of the main petition).

Subsequently, based on the allotment letter, the petitioners also entered into the Agreement to Sell/Flat Buyers Agreement for their respective units (Annexure P-4 of the main petition). The agreements were identical with minor differences and titled as “Agreement to Sell Raheja's Revanta”/ “Agreement For Sale”.

The Project consists of Independent Floors, namely the "TAPAS" and 3 High Rise Towers (A, B & C) connected together, namely the "SURYA TOWERS". The Corporate Debtor had committed under the Agreement For Sale to hand over the possession of the units within 36 months in respect of TAPAS, and within 48 months in respect of SURYA TOWERS from the date of execution of the Agreement.

The Project Completion date was 31.07.2022 as per Form A-H submitted before RERA. However, as per the agreement, the CD was obligated to hand over the possession to the financial creditors. The relevant portion of the Agreement is extracted below:

In accordance with the agreement, the petitioners had diligently made payment towards each of the demands that were raised by the Corporate Debtor in respect to the units in the Project (Annexure P-5 of the main petition). The petitioners also submitted that to meet the payment obligations, some of them had even availed loans from banks, which indicates their bona fide interest in purchasing the units in the Project and that they had booked these units to meet their residential requirements.

The financial creditors had made payments to the tune of Rs. 137,15,54,778.03/- (Rupees One Hundred Thirty Seven Crore Fifteen Lakhs Fifty Four Thousand Seven Hundred Seventy Eight and Three Paise Only) to the Corporate Debtor towards sale consideration. The petitioners submitted that in the majority of the cases, they had made payments of up to 90-95% of the entire sale price. However, the CD completely failed to deliver the possession of the impugned units even within the extended schedule.

Thereafter, some of the petitioners approached the Haryana Real Estate Regulatory Authority (HRERA) to avail a refund/possession from the Corporate Debtor. The HRERA has also recorded adverse findings against the CD and passed directions in favour of some allottees vide order dated 31.01.2023 (Annexure P-8 to the petition). The relevant portion of the order dated 31.01.2023 passed by HRERA is extracted as below:

Meanwhile, the CD had entered into a settlement agreement vide Memorandum of Understanding (MoU) with the financial creditors wherein the CD not only acknowledged the delay on its part in handing over the possession of the units but also agreed to pay compensation and deliver the units as per the directions of HRERA (Annexure P-9 of the petition). However, the Corporate Debtor neither paid any compensation as agreed under the said Settlement Agreement nor delivered the possession of the units as per the agreed terms. A sample of the settlements entered into between the parties is set out below for ready reference:

The Corporate Debtor failed in complying with its aforesaid obligations and in delivering possession of the units to the Financial Creditors. Hence, as on 24.02.2024, the Corporate Debtor is liable to refund to the petitioners an amount to the tune of Rs. 137,15,54,778.03/- (Rupees One Hundred Thirty Seven Crore Fifteen Lakhs Fifty Four Thousand Seven Hundred Seventy Eight and Three Paise Only) along with Interest amounting to Rs. 75,69,71,441.73/- (Rupees Seventy Five Crore Sixty Nine Lakh Seventy One Thousand Four Hundred Forty One and Seventy Three Paisa Only) i.e. a total of Rs. 212,85,26,219.76/- (Rupees Two Hundred Twelve Crore Eighty Five Lakh Twenty Six Thousand Two Hundred Nineteen and Seventy Six Paisa Only).

The petitioners have stated that they have successfully established the two factors required u/s 7 of the Code, i.e. a debt which has become due and payable, and that a default has been committed in respect of such debt. They have also placed reliance on various landmark judgments to add impetus to their arguments.

The petitioners have also submitted that the total number of units in the impugned project is 932, and the same figure has been provided in the FORM REP-I filed with the RERA authority on 07.02.2020 in compliance with the RERA Act, 2016 (Annexure P-10 of the main petition). The petitioners herein hold 99 units out of the total of 932, and therefore, it is stated that the instant petition has been filed by more than 10% of the allottees of the project.

The matter was first listed on 22.04.2024, wherein the following order was passed:

Accordingly, additional affidavits were filed by the petitioner on 10.05.2024 on the DMS e-portal to place on record the additional documents. On the next date, i.e. 14.05.2024, notices were directed to be issued to the respondent for filing a reply.

After due service, the Corporate Debtor filed its reply on 23.07.2024, denying averments made in the Section 7 petition. The objections raised by the respondent are as follows:

a. The 1^st submission of the Respondent in its reply is that the default is caused by actions beyond the control of the Respondent and therefore, the same cannot be made the basis for proceedings under the IBC.

The Respondent submits that the Project is an ultra-high-rise automation tower comprising 61 floors, requiring essential infrastructure and utility connections, including water, electricity, sewerage, and access for fire tenders, the prerequisites which had already been communicated to the allottees.

The Respondent submits that construction of the Project had progressed as per schedule and that approximately Rs. 1119 Crores had been incurred towards the Project against collections of approximately Rs. 826 Crores from customers. The Project had reached the pre-finishing stage; however, further finishing work could not be undertaken due to delays on the part of Government authorities in providing external services and necessary infrastructure.

It is further contended that two High Tension (HT) cable lines were passing through the Project site, which were required to be shifted underground. For the said purpose, the CD engaged KEI Industries Limited on 01.10.2013, and the work was completed on 29.03.2015. Thereafter, the CD applied for issuance of a Performance Certificate from Haryana Vidyut Prasaran Nigam Limited (HVPNL) and informed the Directorate of Town and Country Planning, Haryana (DTCP Haryana) regarding completion of the work. The Respondent states that the application before the District Town Planner, Gurgaon, was filed on 28.10.2014, whereas approval to the revised zoning plan was granted only on 07.10.2016. It is further submitted that the Performance Certificate and Taking Over Certificate were issued by HVPNL on 14.05.2017, more than two years after the application made by the CD.

The Respondent further submits that an application seeking approval of the revised building plan consequent to the shifting of HT cables was submitted on 14.01.2016, whereas approval thereto was granted by the Chief Town Planner, Haryana-cum-Chairman, Building Plan Approval Committee only on 24.04.2017.

It is additionally contended that despite the CD having fulfilled its obligations and paying the External Development Charges (EDC) amounting to Rs. 51.07 Crores and Internal Development Charges (IDC) amounting to Rs. 6 Crores, the Government authorities failed to provide essential infrastructure facilities, including roads, sewerage, water supply, and electricity connectivity. According to the Respondent, the development of such infrastructure was within the domain of the concerned authorities and not within the control of the CD. Thus, the absence of such infrastructure delayed the completion of the Project and consequently resulted in multiple proceedings being initiated by the allottees seeking refunds under the Agreements to Sell.

a. That the Agreement to Sell executed between the CD and the allotees fastens no absolute liability upon the CD as the delay is not attributable to the CD.

To support this contention, the CD has relied upon the following clauses of the agreement:

Relying upon the above clauses, the Respondent contends that under the Agreement to Sell, the timeline for completion of the project was contingent upon the availability of necessary infrastructure facilities. Clause 4.3 states that no compensation was payable by the CD for delays caused by the non-provision of infrastructure. Without prejudice to the aforesaid contention, the Respondent submits that even if the CD were held liable to pay delay compensation, the same would be governed strictly by Clause 4.2 of the Agreement to Sell.

The Respondent further contends that the Project required compatible external infrastructure in order to sustain the internal infrastructure and facilities, considering that the Project was intended to cater to more than 4000 residents and approximately 1200 cars. Thus, no possession could be offered in the absence of integration with essential external infrastructure necessary for habitation, including roads, sewerage, water, and electricity supply.

The respondent has relied on various RTI applications filed by it and the responses received from the authorities between 2018 and 2022. The Respondent submits that the replies from HSVP/HUDA/GMDA reflected that, as of the relevant period, essential infrastructure such as water supply lines, sewerage networks, stormwater drainage, sector roads and other civil amenities had either not been laid or no work had been executed in the sector.

a. That the pending litigations surrounding the project stalled the process

It is the contention of the Respondent that the Project remained unfinished due to multiple pending litigations concerning external infrastructure, acquisition of land and regulatory actions. In support of the said contention, reliance has been placed upon proceedings before the Competition Commission of India (CCI) in Confederation of Real Estate Developers Association of India-NCR v. DTCP, Haryana and HUDA, wherein the CCI has made prima facie observations regarding the failure of the governmental authorities to provide essential external development works and basic infrastructure, including roads, water supply, sewerage and allied civic facilities, without which the real estate projects cannot not be completed or made habitable.

The Respondent has further submitted that acquisition proceedings relating to the sector dividing roads connected with Sector-78, Gurugram, where the Project is situated, have also contributed to the delay. In Balbir Singh v. State of Haryana, the Hon’ble Punjab and Haryana High Court has quashed the acquisition proceedings. The matter was thereafter challenged before the Hon’ble Supreme Court, and adjudication remains pending. Hence, as per the Respondent, the pendency of the said proceedings adversely affected connectivity and access to the Project.

It is further contended that, owing to delays in the development of the Project, multiple proceedings were initiated against the Corporate Debtor before different judicial and regulatory fora, including Haryana RERA, NCDRC, NCLT and the Hon’ble High Courts.

Execution proceedings were also initiated before the Hon’ble NCDRC pursuant to the refund orders passed against the Corporate Debtor. Further, H-RERA, vide order dated 27.03.2023, directed freezing of the Project-related bank accounts and restrained the Corporate Debtor from creating third-party rights in the remaining inventory of the Project.

According to the Respondent, while execution proceedings for enforcement of refund orders were pending before the Hon’ble NCDRC, the freezing of bank accounts and restriction on dealing with the remaining inventory adversely affected the financial and operational functioning of the Corporate Debtor. It is contended that the Corporate Debtor was thereby unable to raise funds, utilize the remaining inventory, or complete the Project. The Respondent has further submitted that proceedings seeking de-freezing of the accounts and permission to deal with the remaining inventory are presently pending before the competent fora.

It is the contention of the Respondent that the Corporate Debtor is a solvent and operational company and no deliberate default can be attributed to it. It is submitted that out of 35 projects undertaken by the Corporate Debtor, 18 projects have already been completed, and 8 projects are presently ongoing. The Respondent has further stated that the Corporate Debtor is also engaged in the development of housing projects for slum dwellers in collaboration with the Government of India.

According to the Respondent, admission of the Corporate Debtor into CIRP would adversely impact approximately 40,000 homebuyers associated with various projects of the Corporate Debtor. It is further contended that the Corporate Debtor has taken all possible steps for completion of the Project and protection of the interests of the homebuyers. The Respondent has thus submitted that the provisions of the Code ought not to be invoked against a financially viable company on account of circumstances allegedly beyond its control.

In pursuance of this reply, a rejoinder has been filed by the petitioners on the DMS e-portal on 13.08.2024. The contentions raised by the Petitioners in response to the claims of the Respondents are summarised hereunder:

As per Clauses 4.3 and 7.1 of the Agreement to Sell, the financial creditors were promised possession within 36 and 48 months from the date of execution of the agreement to sell, i.e. somewhere between 2015 and 2024, as per the dates of the different agreements.

However, as apparent from the construction update provided by the Corporate Debtor vide its reply (Pages 265 & 266, Annuxure-20 of the Reply), the Corporate Debtor has admittedly failed to complete the construction work of the Project till date and thereby has clearly committed a 'default' in terms of the IBC by failing to deliver the possession of the units to the Financial Creditors within the promised timeline. The relevant portion of the construction update is provided below:

The petitioners have further disputed the stand taken by the Corporate Debtor that the Project is at a “pre-finishing stage”. Reliance has been placed upon the present status of the Project, photographs, site maps available on the website of the Corporate Debtor, and Google images to contend that substantial portions of the Project remain incomplete (Annexure 1 of the rejoinder). It has been specifically submitted that Blocks 11, 12, 24 and 25 are still under construction, whereas construction in respect of Blocks 16A, 17, 18, 26 and 27 has not yet commenced.

The project began 13 years ago, and the Corporate Debtor has continued to revise and extend the projected timeline for completion of the Project. According to the petitioners, the Corporate Debtor has recently stated that possession would be handed over within a further period of 28 to 34 months, without specifying the relevant date or event from which the said period will be computed. This fact in itself reflects that the Project is far from completion.

It is clearly evident from the above annexures that the necessary infrastructure is required to receive external services from the Government authorities were missing from the Project. Clause “h’ of the License bearing no. 49 of 2011 issued by the DTCP clearly states that "That you (Corporate Debtor) shall make arrangements for water supply, sewerage, drainage etc., to the satisfaction of the Director till the services are made available from external infrastructure to be laid by HUDA" (Annexure-3 of the rejoinder).

The aforesaid license was expiring on 31.05.2021, and owing to the outstanding EDC/IDC charges not paid by the CD to the concerned department, the license has not even been renewed till date. According to the petitioners, the same demonstrates that the Corporate Debtor has failed to undertake adequate steps to ensure completion of the Project within the committed timeline.

Further, after a period of 12 years from the launch of the Project, the CD has also filed a Writ Petition bearing no CWP No. 609/2023 before the Hon’ble Punjab and Haryana High Court, asking the court to issue directions against the Government authorities to develop the necessary facility. This is nothing but an afterthought of the CD to escape its liability.

The CD has been falsely trying to implicate the Government authorities and is using its RTI applications as a cover. Moreover, reliance placed by the CD on CCI’s order is misplaced. The CCI, in its order dated 13.07.2022 in Case No. 40 of 2017, has held that the DTCP has taken adequate steps to provide infrastructure for the completion of various projects which are currently being occupied by homebuyers. Therefore, it is submitted by the petitioners that the Corporate Debtor has miserably failed to develop the necessary basic internal infrastructure and is now conveniently shifting the blame to the government authorities.

The petitioners in their rejoinder have further contended that it was the CD’s legal obligation to ensure the viability of the project and to have a pre-decided plan in place for the development of the project before its launch.

The total cost of the Project was INR 1000 crores, as mentioned in Form A-H filed by the Corporate Debtor before the HRERA, out of which the CD has already received INR 886 crores, as enclosed in Annexure-20 of the reply.

It is submitted that even after having sufficient funds to complete the project, the CD has also availed loans from some financial institutions as it had already siphoned off the funds collected from the innocent homebuyers.

Moreover, a lien on certain units was created by the CD in favour of EARCL against some loans availed from it. As per the terms of the lien, the CD was supposed to obtain an NOC from EARCL before selling off the units, and the same was not done by the CD. A copy of the public caution notice published by the EARCL in this regard is annexed at Annexure-6 of the rejoinder.

An undertaking was also filed by the CD before the Hon’ble NCLAT in the matter of Navin Raheja v. Shilpa Jain [Company Appeal (AT) (Ins.) No. 864 of 2019, wherein it was specifically indicated that the CD will complete the present project “Raheja Revanta” by July, 2022. Hence, there has been a clear breach of the undertaking too, as the same has not been achieved till date.

Lastly, the petitioners have contended that the proceedings initiated before HRERA don’t constitute a bar for the present proceedings. The Hon’ble Supreme Court in Pioneer Urban & Infrastructure Ltd. & Anr. v. Union of India & Anr. [WP (Civil) No. 43 of 2019] has held that the proceedings under the IBC are independent in nature and hence the pendency of the said complaint filed by the association before the HRERA shall have no bearing on the maintainability of the present section 7 petition.

Vide order dated 14.08.2024, liberty was granted to the respondent to file an additional affidavit on the ground that certain new facts had been placed on record by the Financial Creditors through the rejoinder. Accordingly, an additional affidavit on behalf of the respondent was uploaded on the DMS e-portal on 31.08.2024. The additional facts specifically introduced through the said affidavit, distinct from the earlier pleadings, are summarily captured as below:

Subsequently, a brief note dated 01.10.2024 came to be filed by the CD, and a note dated 16.10.2024 was filed on behalf of the Financial creditors. In response thereto, the CD filed another reply note on 18.10.2024.

It is pertinent to note that during the pendency of the present petition, significant developments took place before the Hon'ble NCLAT concerning project-specific insolvency proceedings against the Corporate Debtor. The admission order dated 19.11.2024 passed in CP (IB)-239/2023 pertaining to Project “Raheja Shilas” was challenged in Company Appeal (AT) (Insolvency) No. 2168 of 2024 before the Hon’ble NCLAT.

By way of an interim order dated 25.08.2025, the Hon'ble NCLAT directed that while matters pertaining to projects of Raheja Developers Ltd., other than “Raheja Shilas”, may continue to be taken up for hearing by the Adjudicating Authority, no final order shall be passed therein in such proceedings.

Subsequently, by order dated 20.03.2026 passed in the aforesaid appeal, the Hon'ble NCLAT clarified that the CIRP initiated vide order dated 19.11.2024 would remain confined to Project “Raheja Shilas” and that allottees of other projects were at liberty to pursue independent proceedings under Section 7 of the Code. The relevant portion of the order dated 20.03.2026 is extracted below for ready reference:

Thereafter, by an order dated 10.04.2026 in Company Appeal (AT) (Ins.) No. 1276 of 2025, the Hon'ble NCLAT similarly confined the CIRP initiated in CP (IB)/284/2025 by Court IV, New Delhi Bench relating to “Krishna Housing Scheme” of the CD to that said project alone.

In view of the aforesaid orders, adjudication of the present petition effectively awaited clarification from the Hon'ble NCLAT regarding the treatment of project-specific CIRPs in respect of the Corporate Debtor before the matter could be finally considered on merits.

Thereafter, a status report was filed by the CD on 07.05.2026. Written submissions filed by the parties after the order in this matter was reserved on 19.05.2026 have also been taken into consideration.

Meanwhile, a fresh application bearing No. IA-2214/2026 was filed by the Corporate Debtor seeking various directions for the completion and revival of Project Raheja Revanta, including appointment of an Advocate Commissioner, induction of a strategic developer and investor, restructuring of the project, and payment of outstanding dues by the homebuyers. The aforesaid application stands disposed of in terms of a separate order passed by this Adjudicating Authority.

Further, an intervention application bearing No. Ivn. P36/2026 was filed by EARCL, a secured creditor and stakeholder in Project Raheja Revanta on 27.05.2026. By way of the said application, EARCL sought to place on record proposals received from strategic partners for the revival and completion of the project. It also sought deferment of the initiation of CIRP for a limited period to facilitate evaluation of the said proposals by the stakeholders, including the homebuyers/allottees.

As regards the above applications, it has been submitted on behalf of the Petitioners that once the orders in the main matter have been reserved, no interim applications can be entertained thereafter and the reliance has been placed upon the judgment dated 01.11.2023 passed by the Hon’ble NCLAT in Company Appeal (AT)(Insolvency) No. 1359 & 1360 of 2023 titled as Loramitra Rath v. JM Financial Asset Reconstruction Company Ltd. and Anr. wherein it was observed that once an order in a matter is reserved, there is no scope for entertaining any application from the parties.

Drawing reference from the above view of the Hon’ble NCLAT, the intervention application has been disposed of by this Adjudicating Authority through a separate order after examining the reliefs sought therein and considering the same on merits.

A tabular representation of the proceedings in the case is as follows:

From the above factual matrix, it is evident that the matter was pending before the Hon’ble NCLAT and only vide order dated 20.03.2026, allottees of other projects/Financial Creditors including Petitioners herein were permitted to pursue proceedings qua respective project under Section 7. Further, on requests made by the parties for completion of their pleadings, this Adjudicating Authority, in the interest of justice, had granted various opportunities to the parties to conclude their respective submissions.

We have heard Ld. Counsels for the parties, perused documents on record, and recorded our analysis in this factual matrix as below.

The present petition has been filed under Section 7 of the IBC by the Financial Creditors seeking initiation of CIRP against the Corporate Debtor. The scope of inquiry under Section 7 of the Code is limited to examining whether there exists a financial debt and whether a default has occurred in respect thereof. Before proceeding to examine the issues raised, it would be apposite to refer here to the relevant provisions of the Code.

Further, for a better understanding of the preceding paragraph, we may refer to the definitions of “allottees” and “real estate project” as defined under the RERA Act, 2016:

An application under section 7 of the Code may be initiated by a FC either by himself or jointly with other FC’s for initiation of Corporate Insolvency Resolution Process (CIRP) against CD, where there exist a ‘debt’ and a ‘default’, meaning thereby, when a debt becomes due and is not paid, the FC under section 7 has a right to file an application under Section 7 of the Code. Under Section 7(2) of The Code read with The Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 (in short ‘AA’ Rules, 2016), a FC is required to apply in the Form 1 (as provided in Rule 4 of ‘AA’ Rules, 2016) accompanied with documents and records as specified in the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons ), Regulations, 2016 (in short “ CIRP Regulations,”). The Form-1 comprises Part 1 to V, where Part IV and V require particulars of ‘Financial Debt’ and the ‘Date of Default’.

It is pertinent to note that the jurisdiction of this Adjudicating Authority under Section 7 of the IBC is limited to examining whether there exists a “financial debt” and whether a “default” has occurred in respect thereof.

The Hon’ble Supreme Court in Innoventive Industries Ltd. v. ICICI Bank (2018) 1 SCC 407 has categorically held that once the Adjudicating Authority is satisfied that a default has occurred, the application shall be admitted unless it is incomplete. The relevant portion of the judgment is attached below for perusal:

Further, taking into consideration the submissions made by Ld. Counsels, and documents filed on behalf of both the parties, the following three issues have been framed for consideration:

Issue I: Whether there exists a “financial debt” and “default” within the meaning of Section 7 of the Code, and whether the present Application satisfies the threshold requirement prescribed under the proviso to Section 7(1) of the Code?

Further, the proviso to Section 7(1) of the Code mandates that an application filed by allottees under a real estate project must be filed jointly by not less than one hundred allottees or not less than ten per cent of the total number of allottees under the same project, whichever is less.

The petitioners have specifically averred that the total number of units in the Project is 932, as reflected in FORM REP-I filed before the RERA Authority. The present petition has been filed by 176 allottees holding 99 units in the Project. Therefore, the threshold requirement contemplated under the proviso to Section 7(1) stands satisfied.

Further, Explanation to Section 5(8)(f) of the Code, as per which the amounts raised from allottees under a real estate project are deemed to be financial debt. The petitioners have placed on record allotment letters, Agreements to Sell, payment receipts, and statements evidencing payment of substantial amounts towards the consideration of their respective units. The petitioners have paid sums towards the construction of Project, which admittedly has not been delivered on time and as such the sum paid towards construction was entitled for refund along with the interest to homebuyers.

The Corporate Debtor has not disputed the execution of the Agreements to Sell nor the receipt of monies from the allottees. The record further reveals that under the Agreements to Sell, the Corporate Debtor had undertaken to hand over possession within 36 months in respect of TAPAS floors and within 48 months in respect of SURYA Towers from the date of execution of the Agreement. However, admittedly, possession has not been handed over till date.

In the present case, the debt is clearly evidenced from aforesaid documents, whereas the default stands established from the admitted non-delivery of possession despite expiry of the timelines assured in the agreement. Therefore, the petitioners have successfully established the existence of a financial debt and a default within the meaning of Section 7 of the Code and that the present Application satisfies the twin-fold requirement of Section 7 thereof.

The principal defense of the Corporate Debtor is that the delay occurred on account of a lack of external infrastructure, such as roads, sewerage, electricity and other approvals from Government Authorities. According to the Corporate Debtor, the delay was beyond its control and therefore cannot constitute a default under Section 7 of the Code. In particular, reliance has been placed upon Clauses 4.2 and 4.3 of the Agreements to contend that the timeline for completion was contingent upon the availability of external infrastructure and that no compensation would be payable for delays attributable to authorities or force majeure circumstances.

We are unable to accept the aforesaid contention. The obligation to complete the Project and hand over possession within the stipulated timeline flows directly from the contractual obligations undertaken by the Corporate Debtor. Merely because certain approvals or external infrastructure were delayed cannot extinguish the rights accrued in favour of the allottees who had paid substantial consideration over a decade ago.

Hence, the allottees cannot be made to wait indefinitely on the ground that external development works were pending. The same has been held by the Hon’ble Supreme Court in the case of Ireo Grace Realtech Pvt. Ltd. v. Abhishek Khanna & Ors. (Civil Appeal No. 5785 of 2019). Furthermore, it has not been shown properly what steps have been taken on behalf of the CD since the beginning to obtain approvals and pursue the government authorities for making available the external facilities. Only in 2023 has a writ petition been filed by the CD before the Hon’ble Punjab & Haryana High Court for enforcing its rights against government authorities.

The Corporate Debtor has itself admitted that despite receipt of approximately Rs. 826 Crores from customers and expenditure of approximately Rs. 1119 Crores towards the Project, the Project remains incomplete and possession has not been offered. The said admission clearly establishes that the Project has not been completed within the promised timelines.

Further, the petitioners have also placed reliance upon proceedings before HRERA wherein adverse findings were recorded against the Corporate Debtor, and directions were issued in favour of certain allottees. The Corporate Debtor has neither complied with the said directions nor delivered possession.

The record additionally reflects that the Corporate Debtor entered into settlement arrangements with certain allottees acknowledging delay in handing over possession and agreeing to pay compensation. However, even those settlement obligations were admittedly not honoured. Such conduct further fortifies the existence of debt and default.

It is also noteworthy that the latest status report dated 07.05.2026 filed by the Corporate Debtor itself proceeds on the basis that construction activities in the Project are continuing and that completion is yet to be achieved. The said report therefore lends support to the position that the Project has not attained completion yet.

The Corporate Debtor has placed reliance upon the force majeure clause contained in the Agreement to Sell to contend that the delay was occasioned by circumstances beyond its control. However, the plea of force majeure is not applicable to the facts of the present case as the difficulties cited by the Corporate Debtor cannot be said to be circumstances beyond its control or of such an unforeseeable nature as would attract the said clause. The hurdles referred to by the CD in its reply, affidavits and written submissions are practical situations which the CD was required to address and resolve in the ordinary course. While external factors may have had some bearing on the progress of the Project, the material placed on record indicates that the Project remains incomplete and possession has not been handed over till date despite a substantial lapse of time beyond the contractual timelines. In such circumstances, the said defence cannot, by itself, defeat the claim of default raised by the petitioners.

The Hon’ble Supreme Court in Pioneer Urban Land and Infrastructure Ltd. v. Union of India (2019) 8 SCC 416 has held that homebuyers are financial creditors and that failure to hand over possession within the stipulated period constitutes default, entitling the allottees to invoke Section 7 of the Code.

In view of the foregoing discussion, we are satisfied that the Corporate Debtor failed to hand over possession of the units within the stipulated timelines despite receipt of substantial consideration from the allottees. The defence sought to be raised on the basis of external infrastructure constraints does not displace the admitted fact of prolonged non-delivery of possession. Accordingly, we hold that such default is attributable to the Corporate Debtor.

Issue III: Whether pendency of proceedings before HRERA and other fora, including settlement arrangements entered into between the parties, bars or affects maintainability of the present petition under Section 7 of the Code?

The pendency of any proceedings before HRERA or NCDRC does not create any bar against initiation of CIRP under the Code. The remedies available under the Code are independent and concurrent in nature.

The Corporate Debtor has contended that several proceedings relating to the Project are pending before HRERA and other fora, and that certain allottees have already sought reliefs of refund, possession and compensation before such authorities.

It is not in dispute that HRERA has also passed orders in favour of certain allottees who had approached it. However, the material placed on record indicates that possession has not been handed over yet and as such cause for filing application under section 7 continues to survive in the wake of well admitted debt and default.

The Hon’ble Supreme Court in Pioneer Urban supra has categorically recognized that remedies under the Code and RERA are concurrent remedies. The relevant portion of the judgment is extracted below:

Therefore, pendency of proceedings before HRERA and other fora does not create any legal impediment to maintainability of the present petition under Section 7 of the Code.

Moving further, it is noted that Project-wise initiation of CIRP has been permitted by the Hon’ble NCLAT in the case of CD itself qua other projects, namely Raheja Shilas and Raheja Krishna Housing Scheme. In case of real estate insolvency, “project-wise insolvency” has become a norm as reference can be further drawn from the judgment of the Hon’ble NCLAT in the case of “Surender Singh v. IDBI Trusteeship Services Ltd. and Anr.”, Company Appeal (AT) (Insolvency) No. 266 of 2026, wherein it was held that:

It is also necessary to consider the manner in which insolvency proceedings against the Corporate Debtor have been dealt with by the Hon’ble NCLAT in relation to its other projects. As noticed hereinabove, the admission order pertaining to Project “Raheja Shilas (Low Rise)” was modified by the Hon’ble NCLAT in Company Appeal (AT) (Ins.) No. 2168 of 2024 and confined only to the said project vide order dated 20.03.2026. Likewise, by order dated 10.04.2026 passed in Company Appeal (AT) (Ins.) No. 1276 of 2025, the CIRP initiated in respect of “Krishna Housing Scheme”, was also restricted to that project alone.

The Appellate Authority has thus recognised the feasibility of undertaking project-specific insolvency resolution in the case of the Corporate Debtor as well, having regard to the distinct nature of its real estate projects and the interests of the stakeholders concerned therein. In view of the aforesaid orders and the liberty granted by the Hon’ble NCLAT to allottees of other projects to pursue independent proceedings under Section 7 of the Code, we are of the considered opinion that any insolvency resolution process arising from the present petition ought likewise to remain confined to Project “Raheja Revanta”. Accordingly, while admitting the present petition, the CIRP shall be restricted to the Project “Raheja Revanta”, and thus, we pass the following order.

Having regard to the conspectus of the present case (as discussed above) we are inclined to ADMIT the present petition bearing No. CP (IB) 182(ND)/2024 under Section 7 of IBC, 2016. Accordingly, the petition bearing No. (IB)-182(ND)/2024 filed by Petitioner under Section 7 of the IBC, 2016 for initiating CIRP against Corporate Debtor, i.e. M/s. Raheja Developers Ltd. is hereby ADMITTED for its Project “Raheja Revanta”. This Adjudicating Authority therefore orders the commencement of the Corporate Insolvency Resolution Process qua Project “Raheja Revanta” of the Corporate Debtor (M/s. Raheja Developers Ltd). Accordingly, the following order is passed: