NCLT directs initiation of insolvency proceedings against Raheja Developers

The National Company Law Tribunal has directed to initiate insolvency proceedings against realty firm Raheja Developers on a petition filed by flat allottees of its Gurgaon-based Shilas project.

The NCLT said Raheja Developers has a "debt due and default" against the flat allottees, who had made their payments and delivery of the units was not on time and referred it for Corporate Insolvency Resolution Process (CIRP).

"The Application bearing... filed by the Applicants under Section 7 of the Insolvency & Bankruptcy Code, 2016, for initiating CIRP against Raheja Developers Ltd is, hereby, admitted," the NCLT said.

A two-member NCLT bench, comprising its President Justice Ramalingam Sudhakar and AK Srivastava, has also appointed Manindra K Tiwari as the Interim Resolution Professional for Raheja Developers.

 

"There is a default on the part of the CD (corporate debtor), in terms of nonpayment of the debt due (delivery of the units) against the amount raised from them under the real estate project when the debt has become due and payable," said the NCLT.

Further, possession was to be given in the year 2012-2014 with a grace period of 6 months. However, it was extended further. This debt has been acknowledged via various emails, and the default is continuing, it said.

The matter relates to the Raheja Shilas project located at Sector 109, Gurugram, Haryana. Over 40 flat buyers have claimed a default of Rs 112.90 crore against the realty firm.

The petitioners had submitted that they have paid over 95 per cent of the total sale price and 100 per cent of all the demand made to date as per the demand letter issued by Raheja Developers in the majority of cases.

However, it completely failed to deliver the possession of impugned units even within the extended schedule as per the agreement to Sell/Flat Buyers Agreement.

While defending, Raheja Developers said the delay of over four years was on account of force majeure, a situation which is beyond its control, and it was covered in the agreement.

It also contended that the petitioners' number is less than 10 per cent of the total buyers, hence the petition was not maintainable.

However, rejecting it, the NCLT said the plea of delay being force majeure taken by the CD shall not apply to the facts of the present case because the difficulty is beyond the control of the CD.

"In this case, CD has entered into a litigation with the government department. Therefore, it cannot be termed as force majeure clause," the NCLT said, adding that "the hurdles stated by CD in its reply, affidavits and written submissions, are not something which can be termed as the force majeure or beyond the control of CD or unforeseeable".

Such statutory compliances, NOC, occupancy certificates etc are part and parcel of such real estate projects.

"These hurdles are practical situations for which CD has to come forward for the resolution and he cannot wipe off its liability by taking the defence of force majeure or the defence of illegitimate claims by government/other appropriate authorities," said NCLT in its 29-page-long order.

Advocate Aditya Parolia represented the association of Revanta, Vanya and Aranya projects of Raheja Developers in the matter.

Earlier also, insolvency proceedings were initiated against Raheja Developers in 2019 over a delay in its Raheja Sampada project.

However, in January 2020, it was set aside as the delay in the project was on account of the absence of clearance by the competent authorities, which was beyond its control.