Content Provider | Supreme Court of India |
---|---|
e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | Insolvency and Bankruptcy Code |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Allowed |
Headnote | Issue for consideration:The decision of the National Company Law Appellate Tribunal thatthe home buyer as beneficiary of a decree by the Uttar PradeshReal Estate Regulatory Authority, the order of the ResolutionProfessional proposing that they be treated differently from otherhome buyers allottees, does not call for interference, is underchallenge.Insolvency and Bankruptcy Code, 2016 – s.5(8)(f) explanation– Financial Creditor – Home buyers allottees in real estateproject who secured the decree from the Real Estate RegulatoryAuthority for a refund of their investment, if could be treatedas financial creditorHeld: Under explanation to s.5(8)(f) home buyers and allotteesof real estate projects were included in the class of “financialcreditors”, because financial debt is owed to them – No distinctionis per se made out between different classes of financial creditorsfor drawing a resolution plan – Resolution Professional’s view thatonce an allottee seeks remedies under RERA, and opts for returnof money in terms of the order made in her favour, it is not open forher to be treated in the class of home buyer, cannot be accepted– Distinction made by the Resolution Professional is artificial andfails afoul of Art.14 – To treat a particular segment of that classdifferently for the purposes of another enactment, on the groundthat one or some of them had elected to take back the depositstogether with such interest as ordered by the competent authority,would be highly inequitable – Underlying claim of an aggrievedparty is crystallized in the form of a Court order or decree, thatdoes not alter or disturb the status of the allottees as financialcreditors – Furthermore, s. 238 IBC contains a non obstante clausewhich gives overriding effect to its provisions, thus, its provisionsacquire primacy, and cannot be read as subordinate to the RERAAct – Thus, the impugned order is set aside – Home buyers aredeclared as financial creditors within the meaning of s. 5(8)(f)explanation and entitled to be treated as such along with otherhome buyers/financial creditors for the purposes of the resolutionplan – Real Estate (Regulation And Development) Act, 2016 – s.18. [Para 6, 8,9] |
Judge | Hon'ble Mr. Justice S. Ravindra Bhat |
Neutral Citation | 2023 INSC 913 |
Petitioner | Vishal Chelani & Ors. |
Respondent | Debashis Nanda |
SCR | [2023] 13 S.C.R. 1149 |
Judgement Date | 2023-10-06 |
Case Number | 3806 |
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