NCLT dismisses homebuyers’ challenge to resolution plan in insolvency case
NCLT) has dismissed an interlocutory application filed by homebuyers to challenge the approved resolution plan of Monarch Brookefields LLP and seek reliefs including the allocation of a specific apartment and resolution of issues affecting homebuyers.
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Despite the said homebuyers’ claim being admitted during the Corporate Insolvency Resolution Process (CIRP), the resolution plan approved by the Committee of Creditors (CoC) granted them only 60% of their claim amount, with no entitlement to the apartment in question.
The tribunal's decision marks a significant legal precedent regarding the rights of individual creditors in insolvency cases. The ruling reaffirms the authority of the CoC in making decisions pertaining to resolution plans and highlights the limitations on individual homebuyers’ ability to contest such decisions.
The crux of the matter lies in the disparity between the expectations of the homebuyers and the terms of the approved resolution plan. While the applicants had hoped for a favorable resolution that would address their concerns and secure their entitlement to the purchased apartment, the approved plan fell short of their expectations.
According to the resolution professional’s response, while the applicants have a registered agreement for sale, it is an admitted position that the developer did not have the permission to construct the 10th floor in the building wing named, ‘Arizona’. The permission to construct any floor
