NCLT closes insolvency proceedings against developer of ATS Le Grandiose project after settlement
New Delhi, May 14
The National Company Law Tribunal has closed the corporate insolvency resolution process against Nobility Estates Private Limited, the developer of ATS Group's "Le Grandiose" housing project in Noida, after approving a settlement reached between lenders and the company's former management.
The order was recently made by the NCLT Principal Bench comprising Acting President Bachu Venkat Balaram Das and Technical Member Ravindra Chaturvedi. The tribunal allowed an application filed under Section 12A of the Insolvency and Bankruptcy Code seeking withdrawal of the insolvency proceedings initiated in November 2023.
The tribunal recorded that the Committee of Creditors (CoC) approved the withdrawal proposal with 92.52 per cent voting share, which is above the mandatory 90 per cent threshold under the IBC. As per the order, 636 homebuyers supported the proposal.
NCLT observed that the withdrawal application fulfilled all legal and procedural requirements under Section 12A and Regulation 30A of the CIRP Regulations. The tribunal noted that Form FA had been submitted, an unconditional bank guarantee was furnished, and the timelines prescribed under the insolvency framework were complied with. It also recorded that no stakeholder objected to the settlement.
According to the settlement terms placed before the tribunal, the former management agreed to pay Rs 108 crore against liabilities of Rs 775 crore owed to ASK Property Investment Advisors Pvt Ltd. Certain dues of other lenders, including JM Financial and Piramal Finance, are proposed to be settled through allotment of units in Phase II of the project.
The ex-management has also undertaken to renew the RERA licence and revalidate the sanctioned building plan within 120 days. It further committed to complete construction of Phase II within 48 months and provide regular updates regarding construction progress, sales and financial status to stakeholders.
While allowing the plea, the tribunal directed restoration of the company's management to its Board of Directors and disposed of all pending applications related to the CIRP proceedings.
The order comes shortly after the NCLT allowed withdrawal of insolvency proceedings against ATS Heights Private Limited, the developer of the ATS Knightsbridge project, under the same provision of the insolvency law.
— ANI
Reader Comments
636 homebuyers supported this - that's a strong signal. But I'm skeptical about the management's commitment. They defaulted once, why trust them now? The RERA license renewal and 48-month deadline need strict monitoring. Let's hope this isn't another endless wait for homebuyers.
Excellent move by NCLT. IBC Section 12A is a great tool for genuine settlements. 92.52% voting share in favor shows the CoC did its homework. ASK Property Investment Advisors taking a big cut though - Rs 108 cr on Rs 775 cr is just 14%. But if it gets homes delivered, it's a win-win.
Good to see the system working for once. The bank guarantee and timeline compliance are positive signs. But the real test will be the next 48 months. Indian real estate needs more transparency on progress updates like the order mentions. Let's hold them accountable.
This sets a good precedent. NCLT is right to allow consensual resolution when procedural norms are met. But I'm worried about homebuyers who already paid. The management must be held to the 120-day RERA renewal deadline. No more extensions!
A sigh of relief for Le Grandiose buyers. But let's be real - the system only works when there's genuine intention to complete. Hope the 48-month timeline is realistic given construction costs and market conditions now. Noida needs more such successful resolutions.
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