NCLAT Closes Insolvency Proceedings Against Marvel Realtors & Developers

NCLAT Closes Insolvency Proceedings Against Marvel Realtors & Developers

The National Company Law Appellate Tribunal (NCLAT), New Delhi bench, has closed the Corporate Insolvency Resolution Process (CIRP) against Marvel Realtors & Developers Ltd., after taking on record settlement with its financial creditor.

The division member bench of Justice Ashok Bhushan (Chairperson) and Barun Mitra (Technical Member) noted that the realtor has submitted a settlement letter dated 8th May 2023 with its financial creditor IDFC First Bank.

The appeal was moved by a Suspended Director- Vishwajeet Subhash Jhavar of the Corporate Debtor- Marvel Realtors & Developers Limited, challenging the Order dated 23rd December, 2022 passed by National Company Law Tribunal, Mumbai, admitting Section 7 Application filed by the IDFC First Bank Limited.

The NCLT had directed to initiate insolvency proceedings against Marvel Realtors & Developers over the plea filed by IDFC First Bank.

Later, on 4th January, 2023, the director approached NCLAT and submitted that a settlement proposal to the bank was already given.

Following this, the NCLAT had stayed on the constitution of the Committee of Creditors (CoC) directing IRP to run the company as a going concern and carry all such business which is normal business.

The NCLAT observed that in the present case, a CoC has not yet been constituted and rejected the claims of the intervener opposing withdrawal of CIRP.

The bank also confirmed by submitting that the said settlement proposal is under active consideration of the management.

Further, the NCLAT said that it was of the view that on account of the objection raised by the intervener of his filing claim before the IRP, the CIRP cannot be allowed to proceed since the debt for which CIRP has been initiated, has been settled with the Financial Creditor.

Moreover, it also rejected the plea of Catalyst Trusteeship, which had filed an intervention application opposing the withdrawal of CIRP against Marvel Realtors & Developers.

The bench granted the liberty to the Intervener to take its own proceeding in accordance with the law to protect it.

The NCLAT ruled, “The Financial Creditor having settled the matter with the Corporate Debtor and Settlement letter dated 08th May, 2023 having been brought on record, we find it a fit case to exercise jurisdiction under Rule 11 of NCLAT Rules, 2016 to close the CIRP.”