ANAND MURTI VS SONI INFRATECH PRIVATE LIMITED & ANR

ANAND MURTI VS SONI INFRATECH PRIVATE LIMITED  & ANR - Supreme Court Case Decision - 

Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले

NON­REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION 

CIVIL APPEAL NOS.7534 OF 2021

ANAND MURTI     ...APPELLANT(S)

VERSUS

SONI INFRATECH PRIVATE LIMITED 

& ANR.    ...RESPONDENT(S)

O R D E R 

B.R. GAVAI, J.

1. The present appeal challenges the order passed by the

National   Company  Law   Appellate   Tribunal,   Principal   Bench,

New Delhi (hereinafter referred to as “the NCLAT”) dated 22nd

November, 2021, in I.A. No.1115 of 2020 in Company Appeal

(AT)   (Insolvency)   No.   1507   of   2019,   thereby   rejecting   the

Modification Application filed by the appellant herein.  Vide the

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impugned order, the NCLAT observed that, in the meantime, if

settlement takes place between the parties for completion of the

housing project, the same can be filed under Section 12A of the

Insolvency and Bankruptcy Code, 2016 (hereinafter referred to

as “the IBC”) before the Adjudicating Authority.   The NCLAT

also   directed   the   Interim   Resolution   Professional   (“IRP”   for

short)/Resolution   Professional   (“RP”   for   short)   to   hold   the

meeting of the Committee of Creditors (hereinafter referred to as

“CoC”) within ten days from the date of order and decide the

future course of action about a resolution for completion of the

Corporate Insolvency Resolution Process (hereinafter referred to

as “CIRP”) of the respondent No.1­company (hereinafter referred

to as “the Corporate Debtor”).  

2. The facts in brief giving rise to the present appeal are as

under:

3. The  appellant  herein  is  the  Suspended  Director  of  the

Corporate Debtor.  The respondent No.2 herein had booked a

flat in the housing project launched by the Corporate Debtor.

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Subsequently,   vide   a   letter   dated   31st  July,   2018,   the

respondent No.2 cancelled the booking and demanded refund of

the amount of Rs.32,27,591/­ from the Corporate Debtor.  

4. On failure of the appellant in refunding the amount, the

respondent No.2 filed an application under Section 7 of the IBC

against the Corporate Debtor for initiation of CIRP before the

National   Company   Law   Tribunal,   New   Delhi   (hereinafter

referred to as “the NCLT”).   The NCLT vide order dated 22nd

November, 2019, admitted the said application and appointed

an   IRP.     The   IRP   was   directed   to   initiate   the   CIRP   of   the

Corporate Debtor as per the provisions of the IBC.  

5. The   appellant   being   aggrieved   by   the   order   dated   22nd

November,   2019,   filed   an   appeal   before   the   NCLAT,   being

Company   Appeal   (AT)   (Insolvency)   No.1507   of   2019.     The

NCLAT vide its order dated 19th December, 2019, issued notice

and passed an interim order, thereby directing the IRP not to

constitute CoC.  

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6. It was submitted by the appellant herein before the NCLAT

that he was ready and willing to settle the matter with the

respondent No.2.   It was further submitted by him that the

project was complete almost to the extent of 70­75% and that

he had arranged the funds/private financier to complete the

project.  

7. In light of the submission made by the appellant herein,

the NCLAT vide order dated 31st  January, 2020, directed the

appellant   herein   to   file   proposed   settlement   terms/plan

disclosing all material particulars with regard to completion of

the   housing   project.     Accordingly,   the   appellant   herein

submitted/filed   the   proposed   settlement   terms/plan   on   13th

February, 2020.  The IRP had submitted his status report a day

prior, on 12th February, 2020, stating therein that most of the

Allottees   decided   to   have   possession   of   the   flats.     In   the

meantime, the appellant settled the matter with the respondent

No.2 herein.  Despite the settlement with the respondent No.2

and   appellant’s   readiness   and   willingness   to   complete   the

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project,   the   NCLAT,   vide   order   dated   26th  February,   2020,

modified   the   interim   order   dated   19th  December,   2019   and

directed the IRP to go ahead with the constitution of CoC and

carry forward the CIRP.   The said order dated 26th February,

2020   was   passed   by   the   NCLAT   on   the   ground   that   the

settlement   arrived   at   by   the   appellant   was   only   with   the

respondent No.2 and the settlement plan did not encompass all

the Allottees.  

8. The appellant therefore approached this Court by way of

Civil Appeal No. 1928 of 2020.  This Court vide order dated 5th

March, 2020, permitted the appellant to approach the NCLAT

for modification of the order dated 26th February, 2020, so as to

present the settlement plan covering all the Allottees. Vide the

said order of this Court dated 5th March, 2020, liberty was also

granted to the appellant to approach this Court again in case

the modification application was not allowed. 

9. Pursuant   thereto,   the   appellant   filed   the   modification

application being I.A. No.1115 of 2020 in Company Appeal (AT)

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(Insolvency) No.1507 of 2019 before the NCLAT.  However, the

NCLAT vide the impugned order dated 22nd  November, 2021,

has rejected the said application for modification and passed

the   order  as  aforesaid.    Being  aggrieved,   the   appellant   has

approached this Court by way of present appeal.  

10. We have heard Shri Shyam Divan, learned Senior Counsel

appearing on behalf of the appellant, Shri D.N. Goburdhun,

learned Senior Counsel appearing on behalf of the applicantshome­buyers   and   Shri   Abhigya   Kushwah,   learned   counsel

appearing on behalf of the respondent No.1/ IRP/applicant.

11. Shri Shyam Divan, learned Senior Counsel, would submit

that in pursuance to the liberty granted by this Court, the

appellant   had   moved   the   NCLAT   placing   on   record   the

settlement with all the stakeholders. He submitted that not only

that but in pursuance to an order passed by the NCLAT dated

29th  September, 2021, a special meeting of the stakeholders

was   convened   on   23rd  October,   2021,   wherein   the   IRP,   the

representatives of the Corporate Debtor, the financial creditors,

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ten   representatives   of   home­buyers   and   the   lawyers

representing home­buyers were present.  He submitted that the

perusal of the minutes of the meeting dated 23rd October, 2021

would show that there was a settlement between the appellant

and the home­buyers almost on all counts.   It is submitted

that, however, the NCLAT, without taking into consideration the

minutes   of   the   said   meeting,   has   erroneously   passed   the

impugned order, thereby holding that there was no settlement

with   all   the   home­buyers   and   that   there   was   trust   deficit

amongst the home­buyers.  He submitted that not only this but

Shri Kashi Nath Shukla, the Promoter of the Corporate Debtor,

has filed an undertaking on an affidavit, thereby undertaking to

complete the project within the stipulated period.  He therefore

submits that it is in the interest of the home­buyers that the

reverse   CIRP   should   be   permitted   to   be   continued   in

accordance with the decision taken in the meeting dated 23rd

October, 2021.

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12. Shri D.N. Goburdhun,  learned Senior Counsel strongly

opposes   the   prayer   made   on   behalf   of   the   appellant.     He

submits that the appellant is not at all interested in completing

the   project.   He   submits   that   the   proposed   settlement

terms/plan   is   not   a  bona   fide  one   but   only   to   delay   the

completion of the project.   He submits that the initiation of

CIRP proceedings would ensure the completion of the project

and would be in the interest of the home­buyers.  He therefore

prays for dismissal of the present appeal.   

13. Shri Abhigya Kushwah, learned counsel, would submit

that   most   of   the   home­buyers   are   interested   in   getting   the

possession of the flats.   He therefore submits that this Court

may   pass   appropriate   orders   taking   into   consideration   the

interests of the purchasers of the flats. 

14. A perusal of the record would reveal that after the order

was passed by this Court on 5th  March, 2020, the appellant

submitted a Revised Proposed Settlement Plan on 15th March,

2021.  The IRP also submitted its Revised Status Report on 25th

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March, 2021 before the NCLAT.  An email dated 9th July, 2021,

addressed by Senior Investment Associate, SBI Cap Ventures

Ltd.­SWAMIH Investment Fund to Shri Kashi Nath Shukla, the

Promoter of the Corporate Debtor, was also placed on record

before  the  NCLAT.     When   the   matter  was  listed  before  the

NCLAT   on   29th  September,   2021,   the   NCLAT   directed   the

IRP/RP,   who   was   present   before   the   NCLAT,   to   convene   a

meeting of CoC within  four weeks to consider the modified

Resolution Plan. The NCLAT further directed that home­buyers

may nominate not more than 10 persons, who will participate

in   the   meeting   and   represent   them.     The   NCLAT   further

directed   that   the   promoters   and   the   authorized   persons   of

Edelweiss   Asset   Reconstruction   Company   Ltd.     (Financier)

would also participate in the meeting so that they can explain

the   elements   of   the   modified   Resolution   Plan   to   the   homebuyers.     The   IRP/RP   was   directed   to   place   on   record   the

minutes of the meeting after the meeting was convened. The

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matter was thereafter directed to be listed for hearing on 15th

November, 2021.  

15. In accordance with the directions issued by the NCLAT, a

meeting was convened on 23rd October, 2021.  A perusal of the

minutes of the meeting dated 23rd October, 2021 would reveal

that the ‘Modified Resolution Plan’ submitted by the Promoter

was presented on a Digital Screen.   During the presentation,

some home­buyers requested for further modification of some

contentious   points   of   the   ‘Modified   Resolution   Plan’.       The

perusal of the minutes of the said meeting would further reveal

that most of the concerns as expressed on behalf of the homebuyers were taken care of by the statement made on behalf of

the Promoters.  

16. It is further to be noted that the Status Report came to be

filed by the IRP before the NCLAT on 3rd November, 2021.  The

said Status Report of the IRP would reveal that the Promoter,

Shri Kashi Nath Shukla had informed that he would file an

addendum   to   his   ‘Modified   Resolution   Plan’   to   include   the

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points   of   home­buyers   and   to   amend   the   plan   as   per

discussions in the Meeting. 

17. However, by the impugned order dated 22nd  November,

2021, the NCLAT has rejected the application for modification

and directed the CIRP to be continued.  

18. It could thus be seen that though a meeting of various

stakeholders   was   conducted   on   23rd  October,   2021   in

pursuance to the directions issued by the NCLAT dated 29th

September, 2021 and in which meeting most of the issues stood

resolved, the NCLAT has failed to take into consideration the

minutes of the said meeting dated 23rd October, 2021.  Not only

that, but the NCLAT has also not taken into consideration the

Revised Status Report dated 3rd November, 2021 submitted by

the IRP.  

19. An additional affidavit dated 27th  December, 2021, has

now been filed by the Promoter, Shri Kashi Nath Shukla before

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this Court. It will be relevant to reproduce the same, which is

as under:

“IN THE SUPREME COURT OF INDIA 

CIVIL ORIGINAL JURISDICTION

CIVIL APPEAL NO. 7534 OF 2021

IN THE MATTER OF:

ANAND MURTI ... APPELLANT

VERSUS

Soni Infratech Pvt. Ltd 

& Anr.    ... RESPONDENTS

AFFIDAVIT

“I   K.N.   Shukla   son   of   Sh   Kailash   Nath

Shukla resident of C­35 Sector 30, Noida, UP

201301 around 68 Years age and the major

share holder of M/S K N Consultant pvt Ltd.

which is promoter of M/S Soni Infratech Pvt

Ltd, (Corporate Debtor) Having its Registered

office   at   517   A,   Narain   Manzil,   23,

Barakhmbha   Road   Connaught   place,   New

Delhi­110001, presently do hereby solemnly

affirm and state as under:

1. That I am conversant with the facts of the

case as such I am competent to affirm

this affidavit. 

2. That I am the original land owner and

existing promoter of the Corporate Debtor

and I say that I have purchased the land

in 2007 for the development of the project

of   the   corporate   debtor   i.e.   M/S   Soni

Infratech Pvt Ltd. 

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3. That   I   have   given   the   land   for   the

development to “SPIRE Group” to develop

the project vide development Agreement.

And   accordingly   the   Development   and

management of the project transferred to

erstwhile promoters i.e. Mr. Sunil Gandhi

and Mr. Ashish Bhalla of “Spire Group”. 

4. That   SPIRE   Group   has   launched   the

project   and   collected   the   booking   from

the home buyers for the said project and

appointed   construction   company   ERA

Group to complete the project. 

5. That After construction of 30­40% work,

ERA Group has stopped the work due to

inter­se  dispute in the ERA group which

lead   to   multiple   litigation   between   the

erstwhile promoters. 

6. That I have discussed about the delay of

the project and after a long discussion

and series of meeting, I managed to take

back the management of the project in

2017. 

7. That I have terminated the Civil contract

of ERA and appointed the new contractor

i.e.   M/s   Indsao   Infratech  and   within   a

period of 18 months we have managed to

complete   approx   70%   of   total

construction   of   the   project   by   mid   of

2018.   The   Enclosed   Construction   audit

report by “Qonquest” confirms the stage

as approx 70% completed.

8. That   I   have   approached   Financial

Creditor M/s Edelweiss to grant further

loan to complete the project. But Due to

stay   granted   by   NCLT   in   CP   No.

N0.175/241/242/(ND)/   2018   arises   in

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the inter­se disputes between Mr. Sunil

Gandhi and Mr. Ashish Bhalla, 50% of

shares of the corporate Debtor could not

be pledged in favour of M/s Edelweiss.

Thus,  the   Edelweiss  has  not   disbursed

the funds for the construction. 

9. That   in   June   2019,   I   managed   to   get

100% share back after the Hon'ble NCLT

decided   the   matter   in   CP   No

175/241/242/(ND)/2018. 

10. That before I could arrange more funds,

an application in case title Balram Singh

Vs. Soni Infratech Private Limited vide its

order dated 22.11.2019 for the CIRP got

admitted. 

11. That suspended Director has preferred

an   Appeal   before   Hon'ble   NCLAT   and

Hon'ble   NCLAT   vide   it   order   dated

19.12.2019 were pleased to grant stay on

CIRP.

12. That as per the direction of the Hon'ble

NCLAT,   i   have   filed   the   settlement

terms/Resolution   Plan   with   all   details

pertaining   how   this   project   will   be

managed   to   be   completed   with   funds

planning and repayment to all Creditors.

13. That I say that I will complete the stage

wise construction within 6 months to 15

months (+/­ 3 Months) in phased manner

from the date of Order.

Particulars  Tower Time   in

Months   (+/­

3 Months)

Stage­I T8­T12 Within   6­9

14

months

Stage­II T1­T4 Within 12 

months

Stage­III T5­T7 Within 15 

months

14. That I say, I had committed in open

court   and   accordingly   arranged   Rs   10

Crore   to   start   the   project   immediately

without any delay and I will ensure this

will be started within 15­30 days. 

15. That   I   have   already   agreed   in   my

Resolution plan that the Cost of the Flat

will not be escalated and agreed to honor

the   BBA   signed   by   the   previous

management.

16. That as per the data before the LD IRP

only   9   home   buyers   out   of   452   Home

Buyers   wanted   the   refund   and   in   my

Resolution Plan I have agreed to refund

the   amount   after   completion   of   the

project of Phase­1.

17. That I have stated all relevant data and

computation in details in my Resolution

Plan that how the funds will be utilized

and how the construction work can be

completed in time. 

18. That I have stated in my last modified

resolution plan that SBI Cap Vetures Ltd

has   already   shown   interest   for   further

Loan of 100 Crore to me. 

19. That   as   per   the   direction   of   Hon'ble

NCLAT I have attended the meeting with

the Representative of the Home Buyers

and I have already accepted and agreed

to   Incorporate   the   suggestions   and

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objections   of   the   Home   Buyers   to   the

Resolution Plan and the same has been

recorded by the LD IRP in the Minutes of

the Meeting dated 23.10.2021.

20. That I have also given my consent to

make a team of 5 person, 2 from buyer

side and 2 from management side and

will be monitored by Ld IRP

21. That   this   affidavit   to   the   additional

documents   in   the   present   Civil   Appeal

have been read by me and are found true

and correct to my knowledge and belief. 

22. That the Annexures are true copies of

their respective originals.

23. That   the   facts   stated   in   the   above

affidavit   are   true   and   correct   to   my

personal knowledge and belief.

24. That No part of the same is false and

nothing   material   have   been   concealed

there from.

DEPONENT

VERIFICATION

I, the above named deponent do hereby

verify that the facts stated in the above

affidavit are true to my knowledge and

belief which I believe to be true.  No part

of the same is false and nothing material

has been concealed there from.

Verified at New Delhi, on this 27th day of

December, 2021.

DEPONENT”

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20. The Promoter, Shri Kashi Nath Shukla has also filed an

undertaking, thereby undertaking to return the money with

interest at the rate of 6% per annum of seven applicants in I.A.

No.11358 of 2022 (for impleadment) in the present appeal, who

were   objecting   to   the   Settlement   Plan   submitted   by   the

appellant. The same is taken on record and marked ‘X’ for

identification. 

21. Taking into consideration the facts and circumstances of

the present case, we find that it will be in the interest of the

home­buyers if the appellant/promoter is permitted to complete

the housing project. The salient features of the undertaking

given on affidavit are as under:

(a)That  the  project  will  be completed  stage­wise  within  a

period of 6 months to 15 months (+/­ 3 months) in a

phased manner;

(b)That the promoter has arranged an amount of Rs. 10

crores to start the project immediately without any delay

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and that he will ensure that the project would be started

within 15­30 days;

(c) That the cost of the flat will not be escalated and that the

promoter is agreeable to honour the BBA signed by the

previous management;

(d)That SBI Cap Ventures Ltd. has already shown interest for

further loan of Rs.100 crore;

(e) That the promoter has given his consent to make a team

of 5 persons, 2 from home­buyer’s side and 2 from the

management   side   and   that   the   entire   process   will   be

monitored by the IRP.  

22. Taking   into   consideration   the   salient   features   of   the

undertaking given on affidavit by the Promoter, Shri Kashi Nath

Shukla and the fact that there are only seven out of the 452

home­buyers, who opposed the Settlement Plan, we find that it

will   rather   be   in   the   interest   of   the   home­buyers   that   the

appellant/promoter   is   permitted   to   complete   the   project   as

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undertaken by him.  It is pertinent to note that he has agreed

that the cost of the flat will not be escalated.  He has also given

the time line within which the project would be completed.  Not

only this, but he has also undertaken to refund the amount

paid by the seven objectors, if they so desire.  He has further

agreed that there shall be a team of 5 persons, 2 from the

home­buyer’s side and 2 from the management side and that

the entire process shall be monitored by the IRP.

23. We find that there is every possibility that if the CIRP is

permitted,   the   cost   that   the   home­buyers   will   have   to   pay,

would be much higher, inasmuch as the offer made by the

resolution applicants could be after taking into consideration

the price of escalation, etc.  As against this, the Promoter has

filed a specific undertaking specifying therein that the cost of

the flat would not be escalated and that he would honour the

BBA signed by the previous management.  

24. In that view of the matter, we are inclined to allow the

present appeal.  Accordingly, we pass the following order:

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A. The appeal is allowed. The impugned order dated 22nd

November, 2021 passed by the National Company Law

Appellate   Tribunal,   Principal   Bench,   New   Delhi   in   I.A.

No.1115 of 2020 in Company Appeal (AT) (Insolvency) No.

1507 of 2019 is quashed and set aside; 

B. The   affidavit   dated   27th  December,   2021   filed   by   Shri

Kashi Nath Shukla, the promoter of the respondent No.1 –

Corporate Debtor is taken on record and treated to be an

undertaking given to this Court; 

C. The   appellant/promoter   is   permitted   to   complete   the

project as per the  deliberations that took  place in  the

Minutes of the Meeting dated 23rd  October, 2021 and in

accordance with the affidavit­cum­undertaking dated 27th

December, 2021 of the Promoter, Shri Kashi Nath Shukla;

D. The modification application being I.A. No.1115 of 2020 in

Company Appeal (AT) (Insolvency) No. 1507 of 2019 before

the NCLAT accordingly stands allowed. 

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E. From the date of this order, the IRP shall submit quarterly

reports to the National Company Law Appellate Tribunal,

Principal Bench, New Delhi with regard to the progress of

the housing project;

F. The matter be listed before the National Company Law

Appellate Tribunal, Principal Bench, New Delhi for such

first Status Report on 22nd August, 2022. 

25. Application for impleadment is allowed.   Application for

clarification/directions   filed   on   behalf   of   the   IRP   does   not

survive and is accordingly dismissed.  Application for vacation

of   stay/modification   of   order   dated   4th  January,   2022   is

rejected.  Pending application(s), if any, shall stand disposed of.

There shall be no order as to costs. 

…..….......................J.

[L. NAGESWARA RAO]

         …….........................J.       

[B.R. GAVAI]

NEW DELHI;

APRIL 27, 2022.

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