Full Judgment Text
Reportable
2026 INSC 104
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
Civil Appeal No. 13628 of 2025
SATINDER SINGH BHASIN … Appellant
versus
COL. GAUTAM MULLICK & ORS … Respondents
with
Civil Appeal No. 13779 of 2025
&
Civil Appeal No. 13812 of 2025
J U D G M E N T
SANJAY KUMAR, J
1. By order dated 04.12.2023 passed in Company Petition IB (IBC) No.
646/PB/2021, the National Company Law Tribunal, Court – V, New Delhi
1
Bench , initiated corporate insolvency resolution process under Section 7
2
of the Insolvency and Bankruptcy Code, 2016 , against M/s. Grand
3
Venezia Commercial Towers Private Limited and M/s. Bhasin Infotech
4
and Infrastructure Private Limited . Assailing the said order, Company
Appeal (AT)(INS) Nos.1593 and 1594 of 2023 came to be filed before the
Signature Not Verified
Digitally signed by
NISHA KHULBEY
Date: 2026.02.02
16:47:21 IST
Reason:
1
For short, ‘the NCLT’
2
For short, ‘the Code’
3
For short, ‘Grand Venezia Ltd.’
4
For short, ‘Bhasin Ltd.’
1
5
National Company Law Appellate Tribunal, Principal Bench, New Delhi .
Ashok Kumar, the appellant in Company Appeal (AT)(INS) No.1593 of
2023, is an erstwhile Director of Grand Venezia Ltd., while Satinder Singh
Bhasin, the appellant in Company Appeal (AT)(INS) No.1594 of 2023, is
an erstwhile Director of Bhasin Ltd. On 07.12.2023, the NCLAT took note
of the appellants’ claim that the constructions were complete and the units
were ready to occupy and directed that no further steps should be taken
pursuant to the order admitting the company petition. The appellants were
also directed not to create third party interests in respect of the
respondents’ units. However, by common judgment dated 29.10.2025, the
NCLAT dismissed both the appeals. Civil Appeal Nos. 13779 and 13812
of 2025 were filed by the appellants therein against the said judgment.
2. Notably, during the pendency of the proceedings before the NCLAT,
Satinder Singh Bhasin filed I.A. No. 5936 of 2025 in his appeal seeking
permission to deposit ₹15,62,00,000/- to prove his bonafides . This I.A.
was filed after judgment was reserved in the appeals. By order dated
07.10.2025, the NCLAT rejected his application. Aggrieved, Satinder
Singh Bhasin filed Civil Appeal No. 13628 of 2025.
3. Though Civil Appeal No. 13628 of 2025 filed by Satinder Singh
Bhasin was earlier in point of time, the substantial appeals are the later
5
For short, ‘the NCLAT’
2
ones, i.e., Civil Appeal Nos. 13779 and 13812 of 2025, and we propose
to deal with them in the first instance.
4. Company Petition IB (IBC) No. 646/PB/2021 was filed by 141
individuals against Grand Venezia Ltd. and Bhasin Ltd., the corporate
debtors, seeking initiation of corporate insolvency resolution process
against them under Section 7 of the Code. They claimed to be financial
creditors, being allottees in the commercial complex, named ‘Grand
Venezia Commercial Tower’, which formed part of a composite and
integrated real estate project launched by Bhasin Ltd. in the year 2005.
This project comprised three sections, namely, a luxury five-star hotel,
including integrated office spaces; a mall having food courts, gaming
zones, gondola rides, etc.; and a cineplex for screening of movies. The
petitioners in the company petition were allottees of office spaces. The
land on which this project was to be erected was leased to Bhasin Ltd. by
6
the Uttar Pradesh State Industrial Development Authority (formerly, Uttar
Pradesh State Industrial Development Corporation). The possession of
the units was to be delivered to the allottees by May, 2013.
5. The complaint of the petitioners before the NCLT was that the units
allotted to them were not made ready and were unfit for occupation. They
asserted that there was no completion certificate provided by the UPSIDA
6
For short, ‘the UPSIDA’
3
in relation to their portion of the project and that the part-completion
certificate which had been issued was only in respect of the showrooms,
food courts, gaming zones and the cinema hall, which were of no
relevance to them. According to them, the corporate debtors had not even
applied for the final completion certificate, as per the RTI reply dated
24.03.2018 received by them from the UPSIDA. They asserted that, as
per the Rules of the UPSIDA, in the absence of a completion certificate
and without the clearance of the UPSIDA, no conveyance/sublease deed
could be executed or registered, and actual possession could not be
delivered. They pointed out that the property in question was leasehold
land and it was necessary that the UPSIDA, being the lessor, and the
developer, being the lessee, confirmed the status of the allottees as
sublessees, by way of tripartite sublease deeds. They relied upon their
allotment letters which posited that possession could not be given without
such tripartite sublease deeds. They further asserted that the developers
had stopped payment of assured returns from January, 2014, though the
same were to be given till final completion was accomplished and tripartite
sublease deeds were executed. They, accordingly, sought initiation of
insolvency proceedings against the corporate debtors.
6. Significantly, Bhasin Ltd. failed to file a reply before the NCLT. Grand
Venezia Ltd., however, filed a reply claiming that it was a broker having
purchase/sale rights of the entire building of which Bhasin Ltd. was the
4
developer. According to it, the petitioners before the NCLT were persons
who had refused to clear their dues and take possession. It alleged that
the corporate debtors had received complete payment of the principal
amounts due from 56 allottees/petitioners but they had failed to pay stamp
duty, while 30 allottees/petitioners had not paid even the principal
amounts. It stated that the hotel in the project was being undertaken by a
separate party while construction of the Grand Venice Mall and Grand
Venezia Commercial Tower was completed by Bhasin Ltd. in 2015. The
completion certificate in that regard was stated to have been issued by
the UPSIDA on 16.04.2015 certifying that the units were completed and,
accordingly, it had issued possession letters to the allottees. Grand
Venezia Ltd. claimed that possession had already been taken by some
allottees, in the light of the UPSIDA’s clarification letter dated 03.03.2017
that the part-completion certificate could be treated as a part-occupancy
certificate. It further claimed that letters had been sent to the allottees,
intimating the compliances achieved and requesting them to initiate the
process of registration of the sublease deeds.
7. After considering the material placed before it and upon hearing the
learned counsel for the parties, the NCLT noted that insofar as admission
of the petition under Section 7 of the Code was concerned, it was
necessary to ascertain whether there was a debt owed to the financial
creditors; whether there was a default with respect to such debt; and, as
5
the financial creditors were allottees of a real estate project, to ascertain
whether they fulfilled the threshold requirement stipulated by Section 7 of
the Code so as to maintain their application.
8. The second proviso to Section 7(1) of the Code prescribes the
threshold requirement in this regard and states to the effect that when the
financial creditors who apply for initiation of corporate insolvency
resolution process are allottees in a real estate project, such an
application should be jointly filed by not less than one hundred such
allottees in the same real estate project or not less than 10% of the total
number of allottees in the same real estate project, whichever is lesser.
9. The company petition was filed on 07.07.2021 by 145 individuals
but as some of them were joint allottees of a single unit, they had to be
counted as one and not as two applicants. An advance copy thereof was
served upon the corporate debtors on 07.06.2021 itself. Thereafter, when
the company petition was returned for curing of defects, 12 allottees who
figured as petitioners in the company petition were removed from the array
of parties and 8 fresh allottees’ names were added. The petition was then
registered and numbered on 22.10.2021 and at that time, 141 allottees
figured therein as petitioners. The petition was listed before the NCLT on
27.10.2021 and notice was issued to the corporate debtors on
21.02.2022. The company petition was admitted on 04.12.2023.
Considering the joint allottees amongst the named petitioners, the NCLT
6
recorded that, in actual terms, allottees of 103 units had filed the petition.
The NCLT noted that settlements were arrived at, subsequently, between
some of those allottees and the corporate debtors and such allottees
withdrew their names from the petition. It was contended by Grand
Venezia Ltd. that 56 such allottees paid the principal amounts in full but
were yet to pay the stamp duty while 30 such allottees had not paid even
the principal amounts, but the NCLT noted that no supporting documents
had been produced in proof of these statements. Reliance was placed by
the NCLT upon the judgment of this Court in Manish Kumar vs. Union of
7
India , wherein it was held that the required minimum of 100 allottees was
to be ascertained as on the date of presentation of the application and not
at the time of its hearing or admission. In view thereof, the NCLT opined
that as allottees of 103 units had filed the application, it fulfilled the
threshold of a minimum of 100 allottees, in terms of Section 7 of the Code.
10. As to the sine qua non for initiation of insolvency process under
Section 7 of the Code, i.e., whether there was a financial debt with a
corresponding default, the NCLT found on facts that the payment receipts
issued by the corporate debtors evidenced that the allottees had made
payments in connection with the units allotted to them and, therefore, the
existence of the financial debt stood substantiated. As to the plea of Grand
7
(2021) 5 SCC 1
7
Venezia Ltd. that the project had been completed and that it was the
allottees who had failed to take possession of their units, the NCLT
observed that the documents placed before it did not manifest completion
of construction. Further, the NCLT also took note of the reply dated
24.03.2018 of the UPSIDA under the Right to Information Act, 2005, that
the developer had not applied for a final completion certificate and that
only a part-completion certificate had been issued. The NCLT, accordingly,
concluded that the corporate debtors had failed to hand over possession
of the units to the allottees and, in consequence, the default in respect of
the financial debt stood proved.
11. Dealing with the contention advanced on behalf of the corporate
debtors that the application was not maintainable as it sought to initiate
insolvency process against two separate corporate entities by way of one
application, the NCLT noted that the Code was silent on initiation and
conducting of insolvency process of related parties in a consolidated
manner. The NCLT opined that interlinkage of related corporate debtors
would be beneficial for value maximization and to continue such
companies as going concerns after completing their insolvency
processes. Reference was made in this regard to the NCLAT’s decision in
Edelweiss Asset Reconstruction Company Limited vs. Sachet
8
8
Infrastructure Private Limited . The NCLT, accordingly, admitted the
petition filed against both the corporate debtors. This order of admission
was subjected to appeal by the erstwhile Directors of the corporate
debtors before the NCLAT but, as stated earlier, without success.
12. In the impugned judgment dated 29.10.2025, the NCLAT first dealt
with the contention that two separate legal entities could not be subjected
to insolvency resolution process through a single company petition. It was
argued that, if taken separately, the allottees of the two corporate debtors
would not meet the threshold requirement of 100 allottees stipulated in
Section 7 of the Code. It was also argued that there was no default on the
part of the corporate debtors, as they had executed 21 bipartite lease
deeds with some of the petitioning allottees even before the filing of the
company petition and had also settled with some other allottees by
refunding their amounts to them. According to the appellants, the only
issue that remained was the execution of tripartite sublease deeds by the
corporate debtors, the UPSIDA and the allottees. It was stated that a writ
petition was filed before the Allahabad High Court by the management of
the corporate debtors to sort out this issue. Reliance was placed on the
part-completion certificate dated 16.04.2015 issued by the Executive
Engineer of the UPSIDA and the clarificatory letter dated 27.06.2015
8
2019 SCC OnLine NCLAT 592
9
certifying that the part-completion certificate was issued for the project,
excluding the hotel portion, i.e., it was issued for the multiplex and the
shopping centre. It was pointed out that it was recorded therein that the
building had been constructed with good quality as per the sanctioned
plan. According to the appellants, these documents settled the issue as to
whether the subject portion of the project stood completed or not.
13. The next issue addressed before the NCLAT was whether the
threshold limit of 100 allottees stood satisfied at the time the company
petition was filed. According to the appellants, the allottees of the two
corporate debtors had been clubbed together to bring the number above
the threshold and this was irregular, being contrary to the prescribed
statutory procedure. Another issue that was argued before the NCLAT
was that a single company petition could not have been entertained
against two corporate debtors.
14. The NCLAT noted that no document had been filed in support of the
plea that settlements had been arrived at with some of the petitioning
allottees even prior to the filing of the company petition. In the absence of
such proof, the NCLAT was inclined to accept the finding of the NCLT that
the allottees of 103 units, who had filed the company petition, met the
threshold requirement of a minimum of 100 allottees. While dealing with
the contention that a joint company petition could not be maintained
against two corporate debtors, the NCLAT committed an error by
10
attributing to the corporate debtors something that was stated by the
allottees in their rejoinder in the company petition. By doing so, the NCLAT
mistakenly inferred that the corporate debtors had themselves admitted
that both the companies were controlled by a single management group.
Notwithstanding this mistake, the NCLAT also took into account allotment
letters in favour of allottees which mentioned the names of both the
corporate debtors. Reference was made in one such letter issued by
Bhasin Ltd. to the application submitted by the allottee to Grand Venezia
Ltd. for booking a commercial office space in Grand Venezia Commercial
Tower. On the same lines, the payment receipts issued to the allottees by
Bhasin Ltd. mentioned the payment received from such allottees for
booking spaces in the Grand Venezia Commercial Tower.
15. Significantly, the allotment letter dated 05.08.2006 issued in favour
of Bhasin Ltd. by the UPSIDA, apropos the lease of the subject land,
specifically mentioned that tripartite lease deeds of the built-up premises
had to be executed by the UPSIDA with the ultimate allottees of the
developer, on the request of the developer in writing. Therein, such
allottees were to be shown as the lessees and the UPSIDA would transfer
the proportionate undelivered interest in the land while the developer
would transfer the interest in the built-up space. It was categorically
mentioned in the said allotment letter that the lease deed of the built-up
space would be executed only after issuance of a completion certificate
11
for that built-up space. The NCLAT noted that the admitted position was
that no tripartite deed was executed since 2006 even for a single allottee.
16. The NCLAT also noted that the Code did not prohibit the filing of a
petition for initiating insolvency process against two corporate entities
jointly and referred to its earlier judgment in Mist Avenue Pvt Ltd vs.
9
Nitin Batra and others . In that case, three companies joined hands to
develop a project. The project was not completed and the companies ran
into rough weather culminating in insolvency proceedings. The NCLAT
held, upon taking a holistic view, that joint insolvency had to be initiated
against all three of them as not doing so would put their allottees to severe
loss and hardship. It was noted that insolvency resolution process in
relation to a real estate project would have different contours and
ramifications and if two or more companies are shown to be closely
connected with the construction and implementation of the project, a joint
petition for initiating insolvency proceedings against such companies
would be maintainable.
17. In this regard, the NCLAT also referred to the Joint Venture
Agreement dated 14.12.2009 between Bhasin Ltd. and Grand Venezia
Ltd. Therein, it was stated that the UPSIDA had allotted land in favour of
Bhasin Ltd. on 05.08.2006; Bhasin Ltd. was constructing a commercial/
9
(2025) 261 Comp Cas 516 = 2023 SCC OnLine NCLAT 2915
12
shopping complex on the said land; Bhasin Ltd. desired to grant exclusive
marketing rights for the purpose of selling units in the said commercial
complex; Grand Venezia Ltd. approached Bhasin Ltd. and expressed its
willingness and consent to do so; Bhasin Ltd. granted exclusive marketing
rights for selling the commercial units constructed by it; and Grand
Venezia Ltd. was authorized to receive and collect payments on behalf of
Bhasin Ltd. only as its agent.
18. This, according to the NCLAT, clearly showed that both the
companies were involved in the project and could not claim to be
independent of each other in relation thereto. The NCLAT also noted that,
though delivery of possession of the units was to be made within five years
from the date of allotment, the same had not taken place till date as no
tripartite sublease deeds had been executed. The NCLAT opined that the
construction had not been completed and found that assured returns
were, admittedly, not paid to allottees since 2014. Reference in that regard
was made to the letter addressed to the allottees by Grand Venezia Ltd.,
stating that the possession of the units would be delivered shortly, as the
structure was nearing completion, but due to a recent slow-down of the
real estate market, the revenue generated was needed and, therefore,
difficulty was being faced in paying the monthly returns to allottees. It was
proposed that, in lieu of the monthly returns for the balance period, i.e.,
upto the date of handing over, extra space would be offered after adjusting
13
the balance amount due from the allottee or the monthly returns would be
adjusted against the outstanding dues for purchase of the unit.
19. The NCLAT also took note of the Status Report dated 11.09.2024
filed by the Interim Resolution Professional appointed by the NCLT on
admission of the company petition, which reflected that the construction
of the project was incomplete. The report reflected that the units from the
rd th
3 floor to the 8 floor were bare-shell structures with raw concrete and
debris scattered all around and even basic elements, such as doors, were
missing. It was further recorded therein that no constructions had taken
th th
place from the 9 floor to the 15 floor. Reference was also made to the
NCLAT-appointed-Observer’s Report dated 15.05.2025 and the UPSIDA’s
Report dated 01.05.2025, which affirmed the findings of the Interim
Resolution Professional. Concluding that the construction was not
complete even as on the date of the order, the NCLAT dismissed the
appeals filed by the erstwhile Directors of both the corporate debtors.
20. The core question raised before us on behalf of the appellants is
whether the threshold limit of 100 allottees prescribed by the second
proviso to Section 7(1) of the Code stood fulfilled in the case on hand. It
is contended that, out of the 103 allottees who had applied to the NCLT,
28 allottees had taken possession while 13 allottees were refunded their
monies by the time of passing of the admission order. It is further claimed
that 7 allottees signed settlement deeds but did not take possession due
14
to registration formalities. Therefore, according to the appellants, the
petitioning allottees with unsettled claims were only 55 in number. It is on
this basis that Satinder Singh Bhasin filed an interlocutory application
before the NCLAT, after judgment was reserved in the appeals, offering to
pay ₹15.62 crores to settle the claims of those 55 allottees.
21. However, as noted by the NCLT, no documentary evidence was
produced before it in proof of settlements having been arrived at with any
of the allottees shown as petitioners in the company petition, prior to the
filing thereof. In any event, the day of reckoning stands settled by this
Court in Manish Kumar ( supra ), wherein it was held that the crucial date
for ascertaining whether the threshold is adequately met is the date of
filing of the petition and not the date of the admission or hearing thereof.
22. Another argument that has been fervently urged is that the allottees
could not have made substitutions in the company petition after the filing
thereof on 07.07.2021, even if the same was returned for curing of
defects. It is the admitted position that alterations were, in fact, made in
the cause-title with regard to the names of the allottees who appeared as
petitioners therein and the refiled petition did not reflect the same names
as were there in the petition initially filed on 07.07.2021. As an advance
copy of the earlier petition was sent to the corporate debtors on
07.06.2021, the appellants would contend that such changes were made
without the authority of law. They assert that the same amounts to an
15
abuse of process, warranting rejection of the company petition in limine .
We may note, at this stage, that this argument was not advanced either
before the NCLT or even before the NCLAT. However, we propose to deal
with the same as it touches upon and impacts the maintainability of the
company petition. In this context, Rule 28 of the National Company Law
10
Tribunal Rules, 2016 , assumes significance. It reads as under:
“28. Endorsement and scrutiny of petition or appeal or document.-
(1) The person in charge of the filing counter shall immediately on receipt
of petition or appeal or application or document affix the date stamp of
Tribunal thereon and also on the additional copies of the index and return
the acknowledgement to the party and he shall also affix his initials on
the stamp affixed on the first page of the copies and enter the particulars
of all such documents in the register after daily filing and assign a diary
number which shall be entered below the date stamp and thereafter
cause it to be sent for scrutiny.
(2) If, on scrutiny, the appeal or petition or application or document is
found to be defective, such document shall, after notice to the party, be
returned for compliance and if there is a failure to comply within seven
days from the date of return, the same shall be placed before the
Registrar who may pass appropriate orders.
(3) The Registrar may for sufficient cause return the said document for
rectification or amendment to the party filing the same, and for this
purpose may allow to the party concerned such reasonable time as he
may consider necessary or extend the time for compliance.
(4) Where the party fails to take any step for the removal of the defect
within the time fixed for the same, the Registrar may, for reasons to be
recorded in writing, decline to register the pleading or document.”
23. The above Rule reflects that the registration of the pleading or
document, as the case may be, is to take place only after the removal of
the defects therein. Rule 28(2) makes it clear that if, upon scrutiny, the
appeal or petition or application or document is found to be defective, the
10
For short, ‘NCLT Rules’
16
same should be returned to the party for compliance. However, Rule 28(3)
goes further and states that a party may be allowed to not only rectify but
also amend such returned appeal or petition or application or document.
Rule 28(4) manifests that it is only after the refiling, upon curing of the
defects, that the Registrar would register the pleading or document. Rule
29 of the NCLT Rules is titled ‘Registration of proceedings admitted’ and
states that on admission of an appeal or petition or caveat or application,
the same shall be numbered and registered in the appropriate register
maintained in that behalf and the number shall be entered therein.
24. Ergo , the mere filing of the company petition on 07.07.2021 did not
result in the same being ‘registered’ on the file of the NCLT and it was only
after rectification/amendment of the petition and upon its refiling, with the
defects therein cured, that the same would have been registered. Notably,
in Surendra Trading Company vs. Juggilal Kamlapat Jute Mills
11
Company Limited and others , this Court held that till the objections in
an application filed under Sections 7, 9 or 10 of the Code are removed, it
is not to be treated as an application validly filed, as it is only after the
application is complete in every respect that it is required to be
entertained. Therefore, the alteration in the memorandum of parties in the
company petition after it was filed on 07.07.2021, but returned for curing
11
(2017) 16 SCC 143
17
the defects therein, did not amount to an abuse of process as is being
contended by the appellants. It was only after ‘registration’ of the company
petition takes place under Rule 28(4) of the NCLT Rules that it would have
been impermissible for the petitioning allottees to make any changes
therein without the leave of the NCLT. As the changes in question were
made by them prior to that event, no adverse inference can be drawn
against them to non-suit them on that ground. Reliance placed on Gurdial
12
Singh and others vs. Raj Kumar Aneja and others is of no avail to
the appellants as the ratio laid down therein that a pleading, once filed,
forms part of the Court record and could not be touched/modified/
substituted/amended except with the leave of the Court, has no
application on facts, in the light of the procedure prescribed under the
NCLT Rules.
25. As regards the contention that a joint company petition could not
have been filed for initiation of insolvency process against two separate
companies, we may note that the letter of allotment, in relation to the
leased land, was issued by the UPSIDA on 05.08.2006 in favour of Bhasin
Ltd alone. The project was, therefore, to be undertaken essentially by
Bhasin Ltd. It was only thereafter, i.e., on 14.12.2009, that Bhasin Ltd.
entered into an agreement with Grand Venezia Ltd., granting it marketing
12
(2002) 2 SCC 445
18
rights in relation to the sale of units in the project. It is a matter of record
that the two companies had common directors, including Satinder Singh
Bhasin, for some length of time. Further, demand notices and possession
letters were issued by Bhasin Ltd. to the allottees of Grand Venezia Ltd.
and the correspondence/communications with the allottees were by both
the companies interchangeably. Payment receipts also manifested the
same. These documents formed part of the company petition.
26. Further, in its reply dated 07.07.2022 filed before the NCLT in the
company petition, we find that Grand Venezia Ltd. had stated that it was
a ‘highly reputed marketer’ and had acquired exclusive marketing rights
for selling the units in the commercial complex constructed by Bhasin Ltd.,
vide the Agreement dated 14.12.2009. This claim stands decimated by
the fact that Grand Venezia Ltd. was incorporated and came into
existence only in November, 2009, barely a month earlier. It, therefore,
had no reputation or experience as a marketer, so to speak of, and
appears to have been incorporated only for the purpose of entering into
an agreement with Bhasin Ltd. in relation to the subject project. Before us,
the appellants have stated that Grand Venezia Ltd. purchased 1,114 units
in the project from Bhasin Ltd. on 31.03.2016 for ₹218 crores. There is,
thus, no possibility at this stage for either company to say that they are
not jointly liable to the allottees of the project. The NCLT and the NCLAT
were, therefore, justified in concluding that the corporate debtors were
19
intrinsically linked and that it would be in their interest to have a joint
insolvency process so as to maximise asset realisation.
27. Significantly, in Edelweiss Asset Reconstruction Company Ltd.
( supra ), the NCLAT was dealing with five companies which had jointly
undertaken development of a township. The NCLAT opined that a ‘Group
Corporate Insolvency Resolution Process’ proceeding was required to be
initiated against all five of them in such circumstances. This order stood
confirmed, when Civil Appeal (Diary) No. 1010 of 2020, challenging the
same, was dismissed by this Court on 10.02.2020. Earlier, in Mamatha
13
vs. Amb Infrabuild P. Ltd. and others , the NCLAT had observed that if
two corporate debtors collaborate and form an independent corporate
entity for developing land and allotting premises to allottees, the
application under Section 7 of the Code would be maintainable against
both of them jointly and not individually against one or the other. This
judgment was confirmed by this Court when the Civil Appeal filed by one
of the corporate debtors was dismissed, vide the order reported in AMB
14
Infrabuild P. Ltd. vs. Mamatha and another . The argument that these
were two completely independent and separate companies, therefore,
falls to the ground. In any event, as they were jointly answerable to the
allottees, the filing of a single company petition against them was justified.
13
(2019) 5 Comp Cas-OL 130 = 2018 SCC Online NCLAT 785
14
2019 SCC Online SC 2410
20
28. We may now turn to the claim of the appellants that the construction
was complete and that the units were ready for occupation before the date
of filing of the company petition. According to the UPSIDA, which had
allotted land to Bhasin Ltd. for erecting this project, the construction was
to be put up within 5 years from the date of allotment, which is long past.
The project to be put up on the allotted land was a single project,
rd rd
comprising a mall up to the 3 floor, commercial spaces from the 3 to the
th
15 floor and a hotel in the adjacent structure. As per Clause 3(p) of the
lease deeds dated 23.08.2006 and 30.09.2009, Bhasin Ltd. was required
to construct the buildings on the leased land within 60 calendar months
from the dates on which the lease deeds were executed or such extended
period of time as was allowed by the UPSIDA in writing. The UPSIDA
asserts that the delay in completion of the project and in execution of
tripartite sublease deeds is attributable to the corporate debtors.
29. The UPSIDA claims that the corporate debtors committed default in
payment of its outstanding dues and had not even furnished to it the final
list of allottees. It further stated that it was never called upon to execute
tripartite lease deeds and, on the other hand, Civil Suit No. 257 of 2018
was filed by Bhasin Ltd. challenging the clauses in the lease deeds which
stipulate that such tripartite lease deeds had to be executed. The suit is
stated to be pending. The list of allottees was communicated to the
UPSIDA for the first time under letter dated 18.04.2024 but it was full of
21
discrepancies and the final undisputed list of allottees is yet to be shared
with it. This was stated to be the sine qua non for execution of tripartite
lease deeds. It was stated that the project does not have a final completion
certificate for the entire construction and the hotel part of the project was
not complete. The UPSIDA asserted that the part-completion certificate
was conditional and was not for the whole project. According to it, affidavit
dated 28.01.2022 was filed in the suit, stating that the part-completion
certificates dated 07.05.2011 and 16.04.2015 were ineffective as the
conditions stipulated therein were not complied with. The UPSIDA further
stated that its dues of ₹54.38 crores were payable by Bhasin Ltd. The writ
petition filed against it by Bhasin Ltd. in that regard was dismissed by the
Allahabad High Court on 08.09.2025, granting liberty to the UPSIDA to
approach the Interim Resolution Professional (IRP) to lodge its claim.
30. In this regard, we may note that Regulation 2.16.0 of the Uttar
Pradesh State Industrial Development Area Building Regulations, 2004,
falling in Chapter-2, titled ‘Procedural Requirements for Building
Permission’, deals with ‘Occupancy Certificate’ and states that no building
erected, re-erected or altered, shall be occupied in whole or in part until
the issuance of an Occupancy Certificate by the Authorised Officer in the
form given in Appendix-11. It is an admitted fact that an Occupancy
Certificate in the prescribed format in Appendix-11 has not been issued by
the UPSIDA till date for the project.
22
31. ‘Handing over/Taking over of possession’ letters issued by Bhasin
Ltd. in favour of allottees, recording delivery of possession of particular
units, have been placed on record. However, we find that some of those
st
letters pertain to the 1 floor of the building, with which the petitioning
allottees in the company petition have no concern. Those letters,
therefore, do not further the case of the appellants. A letter was issued in
th
relation to a unit on the 7 floor in favour of one Sheetal Badhwar but the
undertaking of that allottee records that the sublease deed with the
UPSIDA was yet to be executed. Further, notional possession letters were
also issued to allottees, which are of no significance whatsoever. These
so-called letters of actual delivery of physical possession, in our
considered opinion, have no legal import given the categorical stipulation
by the UPSIDA in its allotment letter and also the lease deeds that physical
possession should not be delivered to allottees without execution of the
tripartite sublease deeds.
32. Though the appellants also place reliance on the part-completion
and part-occupancy letters received from the UPSIDA in 2015 and earlier,
coupled with the notional/physical delivery of possession letters issued to
the allottees, the same have to be construed and understood in the
context of the extant legal regime and the contractual clauses between
the parties. The clauses in the allotment letter dated 05.08.2006 and the
clauses in the lease deeds of the UPSIDA made it clear that possession
23
could not be offered to allottees without tripartite sublease deeds being
executed. This was clarified by the Regional Manager of the UPSIDA in
his letter dated 21.02.2023 addressed to one of the allottees under the
Right to Information Act, 2005. He confirmed therein that no tripartite
sublease deed had been executed in favour of any allottee till that date
and in the event the builders had executed sublease deeds directly in
favour of any allottees, the same would be in clear violation of the terms
and conditions of the allotment letter and the lease deeds.
33. We may note that some of the letters issued in the year 2015 by
Bhasin Ltd. merely offered notional possession to the allottees. Letter
dated 13.10.2015 addressed to Kanwaljeet Singh, one such allottee, is
placed on record in this regard. The part-completion/part-occupancy
letters and the notional/physical possession delivery letters issued to the
allottees, therefore, can be taken to be proof of completion of the
construction in all respects, as is being claimed by the appellants. Further,
their claim in that regard is also belied by the Commissioner’s Report
dated 17.05.2018 filed before the High Court of Delhi in an earlier winding-
up proceeding. Therein, the Commissioner had recorded that none of the
units were ready and fit for occupation as on the date of his inspection.
This report formed part of the record before the NCLAT.
34. Though we would have ordinarily restricted the scope of enquiry in
this regard to documents prior to the date of admission of the company
24
petition and which formed part of the record before the NCLT, we may note
that the appellants secured an interim order from the NCLAT on
07.12.2023 by claiming that the construction was complete and that the
units were ready to occupy. This interim order continued to operate for
nearly two years thereafter. It was during the pendency of the proceedings
that the NCLAT undertook the exercise of verifying this claim of the
appellants and appointed an Observer to visit the premises and submit a
report as to the situation actually obtaining. It was pursuant thereto that
the Observer’s Report dated 15.05.2025 came to be filed before the
NCLAT leading to the dismissal of the appeals on 29.10.2025. We are,
therefore, of the opinion that this report also warrants examination.
35. In his report dated 15.05.2025, the Observer stated that he had
visited the subject premises on 10.05.2025, accompanied by the
representatives of the suspended management of the corporate debtors,
th
the financial creditors and the UPSIDA. With regard to the units on the 9 ,
th th th th
10 , 11 , 12 and 14 floors, the Observer noted that only 1 out of the 6
lifts in the office building/commercial tower was working but that lift also
th
had accessibility only till the 9 floor. On that floor, the Observer found that
no units had been constructed and was told by the representative of the
th
suspended management that no units had been constructed on the 9
th
floor and above till the terrace, i.e., the 15 floor. As regards the units on
rd th th th th th
the 3 , 4 , 5 , 6 , 7 and 8 floors, the Observer noted that upon reaching
25
th
the 8 floor, he found that the said floor was partly constructed but lacked
basic amenities such as bathrooms, lighting, air-conditioning, etc. No fire
safety equipment was installed on the said floor. Similar was the situation
th th th th
with the 5 , 6 and 7 floors. On the 4 floor, the Observer found that the
unit walls were made of gypsum-like material and not brick. Again, basic
amenities were missing and the Observer opined that it would not be
possible to hand over immediate possession to the allotees of the units
rd
on this floor. The units on the 3 floor were also found to be in the same
condition, as some units did not have partitions between them and a lot of
construction material was stored in one unit. He concluded that, at
present, the commercial tower/office building integrated with the mall was
only partially built and lacked basic amenities. He further stated that the
units situated on all the floors required substantial amount of work to be
done before giving possession to the allotees in a fit and proper state. The
rd
pictures appended to the Observer’s Report in relation to the 3 floor show
that there is no possibility of actual physical possession being delivered of
any unit on that floor to the allotees.
36. Viewed thus in totality, the contention of the appellants that the
construction was completed in all respects and possession was delivered
to some of the petitioning allottees is found to be without merit and factual
foundation. Notwithstanding the letters and documents sought to be relied
upon in that regard, the ground reality is otherwise. Neither has the
26
construction been completed nor could possession of units be delivered
to the allottees without fulfilling all necessary formalities in that regard after
completion of the building in all respects.
37. On the above analysis, we hold that the company petition instituted
under Section 7 of the Code against both the corporate debtors by the
allottees of 103 units was maintainable on all counts. The petitioning
allottees duly established their financial debt and also the default in
connection therewith, inasmuch as the units for which they had paid
valuable consideration were not made ready and delivered to them till
date. We, accordingly, find no error having been committed either by the
NCLT in admitting the company petition or by the NCLAT in confirming the
same in appeal. Hence, Civil Appeal Nos. 13779 and 13812 of 2025 are
bereft of merit and deserve to be dismissed.
38. Insofar as Civil Appeal No. 13628 of 2025 is concerned, the offer
made by Satinder Singh Bhasin, the appellant therein, to deposit a sum
of ₹15.62 crores was based on the premise that the said amount would
suffice to settle the claims of the 55 alleged allottees who, according to
him, still remained in the fray after settlement of the claims of the other
petitioning allottees in the company petition. In the light of what has been
stated by the NCLT and the NCLAT and what we have recorded
hereinabove, this premise is itself found to be without basis. Therefore,
the order passed by the NCLAT rejecting the offer made by Satinder Singh
27
Bhasin, vide the order dated 07.10.2025, does not warrant interference
either on facts or in law. This appeal is equally devoid of merit.
All the three appeals are, accordingly, dismissed.
Pending applications shall also stand dismissed.
.............................., J.
SANJAY KUMAR
..............................., J.
K. VINOD CHANDRAN
January 2, 2026
New Delhi.
28
2026 INSC 104
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
Civil Appeal No. 13628 of 2025
SATINDER SINGH BHASIN … Appellant
versus
COL. GAUTAM MULLICK & ORS … Respondents
with
Civil Appeal No. 13779 of 2025
&
Civil Appeal No. 13812 of 2025
J U D G M E N T
SANJAY KUMAR, J
1. By order dated 04.12.2023 passed in Company Petition IB (IBC) No.
646/PB/2021, the National Company Law Tribunal, Court – V, New Delhi
1
Bench , initiated corporate insolvency resolution process under Section 7
2
of the Insolvency and Bankruptcy Code, 2016 , against M/s. Grand
3
Venezia Commercial Towers Private Limited and M/s. Bhasin Infotech
4
and Infrastructure Private Limited . Assailing the said order, Company
Appeal (AT)(INS) Nos.1593 and 1594 of 2023 came to be filed before the
Signature Not Verified
Digitally signed by
NISHA KHULBEY
Date: 2026.02.02
16:47:21 IST
Reason:
1
For short, ‘the NCLT’
2
For short, ‘the Code’
3
For short, ‘Grand Venezia Ltd.’
4
For short, ‘Bhasin Ltd.’
1
5
National Company Law Appellate Tribunal, Principal Bench, New Delhi .
Ashok Kumar, the appellant in Company Appeal (AT)(INS) No.1593 of
2023, is an erstwhile Director of Grand Venezia Ltd., while Satinder Singh
Bhasin, the appellant in Company Appeal (AT)(INS) No.1594 of 2023, is
an erstwhile Director of Bhasin Ltd. On 07.12.2023, the NCLAT took note
of the appellants’ claim that the constructions were complete and the units
were ready to occupy and directed that no further steps should be taken
pursuant to the order admitting the company petition. The appellants were
also directed not to create third party interests in respect of the
respondents’ units. However, by common judgment dated 29.10.2025, the
NCLAT dismissed both the appeals. Civil Appeal Nos. 13779 and 13812
of 2025 were filed by the appellants therein against the said judgment.
2. Notably, during the pendency of the proceedings before the NCLAT,
Satinder Singh Bhasin filed I.A. No. 5936 of 2025 in his appeal seeking
permission to deposit ₹15,62,00,000/- to prove his bonafides . This I.A.
was filed after judgment was reserved in the appeals. By order dated
07.10.2025, the NCLAT rejected his application. Aggrieved, Satinder
Singh Bhasin filed Civil Appeal No. 13628 of 2025.
3. Though Civil Appeal No. 13628 of 2025 filed by Satinder Singh
Bhasin was earlier in point of time, the substantial appeals are the later
5
For short, ‘the NCLAT’
2
ones, i.e., Civil Appeal Nos. 13779 and 13812 of 2025, and we propose
to deal with them in the first instance.
4. Company Petition IB (IBC) No. 646/PB/2021 was filed by 141
individuals against Grand Venezia Ltd. and Bhasin Ltd., the corporate
debtors, seeking initiation of corporate insolvency resolution process
against them under Section 7 of the Code. They claimed to be financial
creditors, being allottees in the commercial complex, named ‘Grand
Venezia Commercial Tower’, which formed part of a composite and
integrated real estate project launched by Bhasin Ltd. in the year 2005.
This project comprised three sections, namely, a luxury five-star hotel,
including integrated office spaces; a mall having food courts, gaming
zones, gondola rides, etc.; and a cineplex for screening of movies. The
petitioners in the company petition were allottees of office spaces. The
land on which this project was to be erected was leased to Bhasin Ltd. by
6
the Uttar Pradesh State Industrial Development Authority (formerly, Uttar
Pradesh State Industrial Development Corporation). The possession of
the units was to be delivered to the allottees by May, 2013.
5. The complaint of the petitioners before the NCLT was that the units
allotted to them were not made ready and were unfit for occupation. They
asserted that there was no completion certificate provided by the UPSIDA
6
For short, ‘the UPSIDA’
3
in relation to their portion of the project and that the part-completion
certificate which had been issued was only in respect of the showrooms,
food courts, gaming zones and the cinema hall, which were of no
relevance to them. According to them, the corporate debtors had not even
applied for the final completion certificate, as per the RTI reply dated
24.03.2018 received by them from the UPSIDA. They asserted that, as
per the Rules of the UPSIDA, in the absence of a completion certificate
and without the clearance of the UPSIDA, no conveyance/sublease deed
could be executed or registered, and actual possession could not be
delivered. They pointed out that the property in question was leasehold
land and it was necessary that the UPSIDA, being the lessor, and the
developer, being the lessee, confirmed the status of the allottees as
sublessees, by way of tripartite sublease deeds. They relied upon their
allotment letters which posited that possession could not be given without
such tripartite sublease deeds. They further asserted that the developers
had stopped payment of assured returns from January, 2014, though the
same were to be given till final completion was accomplished and tripartite
sublease deeds were executed. They, accordingly, sought initiation of
insolvency proceedings against the corporate debtors.
6. Significantly, Bhasin Ltd. failed to file a reply before the NCLT. Grand
Venezia Ltd., however, filed a reply claiming that it was a broker having
purchase/sale rights of the entire building of which Bhasin Ltd. was the
4
developer. According to it, the petitioners before the NCLT were persons
who had refused to clear their dues and take possession. It alleged that
the corporate debtors had received complete payment of the principal
amounts due from 56 allottees/petitioners but they had failed to pay stamp
duty, while 30 allottees/petitioners had not paid even the principal
amounts. It stated that the hotel in the project was being undertaken by a
separate party while construction of the Grand Venice Mall and Grand
Venezia Commercial Tower was completed by Bhasin Ltd. in 2015. The
completion certificate in that regard was stated to have been issued by
the UPSIDA on 16.04.2015 certifying that the units were completed and,
accordingly, it had issued possession letters to the allottees. Grand
Venezia Ltd. claimed that possession had already been taken by some
allottees, in the light of the UPSIDA’s clarification letter dated 03.03.2017
that the part-completion certificate could be treated as a part-occupancy
certificate. It further claimed that letters had been sent to the allottees,
intimating the compliances achieved and requesting them to initiate the
process of registration of the sublease deeds.
7. After considering the material placed before it and upon hearing the
learned counsel for the parties, the NCLT noted that insofar as admission
of the petition under Section 7 of the Code was concerned, it was
necessary to ascertain whether there was a debt owed to the financial
creditors; whether there was a default with respect to such debt; and, as
5
the financial creditors were allottees of a real estate project, to ascertain
whether they fulfilled the threshold requirement stipulated by Section 7 of
the Code so as to maintain their application.
8. The second proviso to Section 7(1) of the Code prescribes the
threshold requirement in this regard and states to the effect that when the
financial creditors who apply for initiation of corporate insolvency
resolution process are allottees in a real estate project, such an
application should be jointly filed by not less than one hundred such
allottees in the same real estate project or not less than 10% of the total
number of allottees in the same real estate project, whichever is lesser.
9. The company petition was filed on 07.07.2021 by 145 individuals
but as some of them were joint allottees of a single unit, they had to be
counted as one and not as two applicants. An advance copy thereof was
served upon the corporate debtors on 07.06.2021 itself. Thereafter, when
the company petition was returned for curing of defects, 12 allottees who
figured as petitioners in the company petition were removed from the array
of parties and 8 fresh allottees’ names were added. The petition was then
registered and numbered on 22.10.2021 and at that time, 141 allottees
figured therein as petitioners. The petition was listed before the NCLT on
27.10.2021 and notice was issued to the corporate debtors on
21.02.2022. The company petition was admitted on 04.12.2023.
Considering the joint allottees amongst the named petitioners, the NCLT
6
recorded that, in actual terms, allottees of 103 units had filed the petition.
The NCLT noted that settlements were arrived at, subsequently, between
some of those allottees and the corporate debtors and such allottees
withdrew their names from the petition. It was contended by Grand
Venezia Ltd. that 56 such allottees paid the principal amounts in full but
were yet to pay the stamp duty while 30 such allottees had not paid even
the principal amounts, but the NCLT noted that no supporting documents
had been produced in proof of these statements. Reliance was placed by
the NCLT upon the judgment of this Court in Manish Kumar vs. Union of
7
India , wherein it was held that the required minimum of 100 allottees was
to be ascertained as on the date of presentation of the application and not
at the time of its hearing or admission. In view thereof, the NCLT opined
that as allottees of 103 units had filed the application, it fulfilled the
threshold of a minimum of 100 allottees, in terms of Section 7 of the Code.
10. As to the sine qua non for initiation of insolvency process under
Section 7 of the Code, i.e., whether there was a financial debt with a
corresponding default, the NCLT found on facts that the payment receipts
issued by the corporate debtors evidenced that the allottees had made
payments in connection with the units allotted to them and, therefore, the
existence of the financial debt stood substantiated. As to the plea of Grand
7
(2021) 5 SCC 1
7
Venezia Ltd. that the project had been completed and that it was the
allottees who had failed to take possession of their units, the NCLT
observed that the documents placed before it did not manifest completion
of construction. Further, the NCLT also took note of the reply dated
24.03.2018 of the UPSIDA under the Right to Information Act, 2005, that
the developer had not applied for a final completion certificate and that
only a part-completion certificate had been issued. The NCLT, accordingly,
concluded that the corporate debtors had failed to hand over possession
of the units to the allottees and, in consequence, the default in respect of
the financial debt stood proved.
11. Dealing with the contention advanced on behalf of the corporate
debtors that the application was not maintainable as it sought to initiate
insolvency process against two separate corporate entities by way of one
application, the NCLT noted that the Code was silent on initiation and
conducting of insolvency process of related parties in a consolidated
manner. The NCLT opined that interlinkage of related corporate debtors
would be beneficial for value maximization and to continue such
companies as going concerns after completing their insolvency
processes. Reference was made in this regard to the NCLAT’s decision in
Edelweiss Asset Reconstruction Company Limited vs. Sachet
8
8
Infrastructure Private Limited . The NCLT, accordingly, admitted the
petition filed against both the corporate debtors. This order of admission
was subjected to appeal by the erstwhile Directors of the corporate
debtors before the NCLAT but, as stated earlier, without success.
12. In the impugned judgment dated 29.10.2025, the NCLAT first dealt
with the contention that two separate legal entities could not be subjected
to insolvency resolution process through a single company petition. It was
argued that, if taken separately, the allottees of the two corporate debtors
would not meet the threshold requirement of 100 allottees stipulated in
Section 7 of the Code. It was also argued that there was no default on the
part of the corporate debtors, as they had executed 21 bipartite lease
deeds with some of the petitioning allottees even before the filing of the
company petition and had also settled with some other allottees by
refunding their amounts to them. According to the appellants, the only
issue that remained was the execution of tripartite sublease deeds by the
corporate debtors, the UPSIDA and the allottees. It was stated that a writ
petition was filed before the Allahabad High Court by the management of
the corporate debtors to sort out this issue. Reliance was placed on the
part-completion certificate dated 16.04.2015 issued by the Executive
Engineer of the UPSIDA and the clarificatory letter dated 27.06.2015
8
2019 SCC OnLine NCLAT 592
9
certifying that the part-completion certificate was issued for the project,
excluding the hotel portion, i.e., it was issued for the multiplex and the
shopping centre. It was pointed out that it was recorded therein that the
building had been constructed with good quality as per the sanctioned
plan. According to the appellants, these documents settled the issue as to
whether the subject portion of the project stood completed or not.
13. The next issue addressed before the NCLAT was whether the
threshold limit of 100 allottees stood satisfied at the time the company
petition was filed. According to the appellants, the allottees of the two
corporate debtors had been clubbed together to bring the number above
the threshold and this was irregular, being contrary to the prescribed
statutory procedure. Another issue that was argued before the NCLAT
was that a single company petition could not have been entertained
against two corporate debtors.
14. The NCLAT noted that no document had been filed in support of the
plea that settlements had been arrived at with some of the petitioning
allottees even prior to the filing of the company petition. In the absence of
such proof, the NCLAT was inclined to accept the finding of the NCLT that
the allottees of 103 units, who had filed the company petition, met the
threshold requirement of a minimum of 100 allottees. While dealing with
the contention that a joint company petition could not be maintained
against two corporate debtors, the NCLAT committed an error by
10
attributing to the corporate debtors something that was stated by the
allottees in their rejoinder in the company petition. By doing so, the NCLAT
mistakenly inferred that the corporate debtors had themselves admitted
that both the companies were controlled by a single management group.
Notwithstanding this mistake, the NCLAT also took into account allotment
letters in favour of allottees which mentioned the names of both the
corporate debtors. Reference was made in one such letter issued by
Bhasin Ltd. to the application submitted by the allottee to Grand Venezia
Ltd. for booking a commercial office space in Grand Venezia Commercial
Tower. On the same lines, the payment receipts issued to the allottees by
Bhasin Ltd. mentioned the payment received from such allottees for
booking spaces in the Grand Venezia Commercial Tower.
15. Significantly, the allotment letter dated 05.08.2006 issued in favour
of Bhasin Ltd. by the UPSIDA, apropos the lease of the subject land,
specifically mentioned that tripartite lease deeds of the built-up premises
had to be executed by the UPSIDA with the ultimate allottees of the
developer, on the request of the developer in writing. Therein, such
allottees were to be shown as the lessees and the UPSIDA would transfer
the proportionate undelivered interest in the land while the developer
would transfer the interest in the built-up space. It was categorically
mentioned in the said allotment letter that the lease deed of the built-up
space would be executed only after issuance of a completion certificate
11
for that built-up space. The NCLAT noted that the admitted position was
that no tripartite deed was executed since 2006 even for a single allottee.
16. The NCLAT also noted that the Code did not prohibit the filing of a
petition for initiating insolvency process against two corporate entities
jointly and referred to its earlier judgment in Mist Avenue Pvt Ltd vs.
9
Nitin Batra and others . In that case, three companies joined hands to
develop a project. The project was not completed and the companies ran
into rough weather culminating in insolvency proceedings. The NCLAT
held, upon taking a holistic view, that joint insolvency had to be initiated
against all three of them as not doing so would put their allottees to severe
loss and hardship. It was noted that insolvency resolution process in
relation to a real estate project would have different contours and
ramifications and if two or more companies are shown to be closely
connected with the construction and implementation of the project, a joint
petition for initiating insolvency proceedings against such companies
would be maintainable.
17. In this regard, the NCLAT also referred to the Joint Venture
Agreement dated 14.12.2009 between Bhasin Ltd. and Grand Venezia
Ltd. Therein, it was stated that the UPSIDA had allotted land in favour of
Bhasin Ltd. on 05.08.2006; Bhasin Ltd. was constructing a commercial/
9
(2025) 261 Comp Cas 516 = 2023 SCC OnLine NCLAT 2915
12
shopping complex on the said land; Bhasin Ltd. desired to grant exclusive
marketing rights for the purpose of selling units in the said commercial
complex; Grand Venezia Ltd. approached Bhasin Ltd. and expressed its
willingness and consent to do so; Bhasin Ltd. granted exclusive marketing
rights for selling the commercial units constructed by it; and Grand
Venezia Ltd. was authorized to receive and collect payments on behalf of
Bhasin Ltd. only as its agent.
18. This, according to the NCLAT, clearly showed that both the
companies were involved in the project and could not claim to be
independent of each other in relation thereto. The NCLAT also noted that,
though delivery of possession of the units was to be made within five years
from the date of allotment, the same had not taken place till date as no
tripartite sublease deeds had been executed. The NCLAT opined that the
construction had not been completed and found that assured returns
were, admittedly, not paid to allottees since 2014. Reference in that regard
was made to the letter addressed to the allottees by Grand Venezia Ltd.,
stating that the possession of the units would be delivered shortly, as the
structure was nearing completion, but due to a recent slow-down of the
real estate market, the revenue generated was needed and, therefore,
difficulty was being faced in paying the monthly returns to allottees. It was
proposed that, in lieu of the monthly returns for the balance period, i.e.,
upto the date of handing over, extra space would be offered after adjusting
13
the balance amount due from the allottee or the monthly returns would be
adjusted against the outstanding dues for purchase of the unit.
19. The NCLAT also took note of the Status Report dated 11.09.2024
filed by the Interim Resolution Professional appointed by the NCLT on
admission of the company petition, which reflected that the construction
of the project was incomplete. The report reflected that the units from the
rd th
3 floor to the 8 floor were bare-shell structures with raw concrete and
debris scattered all around and even basic elements, such as doors, were
missing. It was further recorded therein that no constructions had taken
th th
place from the 9 floor to the 15 floor. Reference was also made to the
NCLAT-appointed-Observer’s Report dated 15.05.2025 and the UPSIDA’s
Report dated 01.05.2025, which affirmed the findings of the Interim
Resolution Professional. Concluding that the construction was not
complete even as on the date of the order, the NCLAT dismissed the
appeals filed by the erstwhile Directors of both the corporate debtors.
20. The core question raised before us on behalf of the appellants is
whether the threshold limit of 100 allottees prescribed by the second
proviso to Section 7(1) of the Code stood fulfilled in the case on hand. It
is contended that, out of the 103 allottees who had applied to the NCLT,
28 allottees had taken possession while 13 allottees were refunded their
monies by the time of passing of the admission order. It is further claimed
that 7 allottees signed settlement deeds but did not take possession due
14
to registration formalities. Therefore, according to the appellants, the
petitioning allottees with unsettled claims were only 55 in number. It is on
this basis that Satinder Singh Bhasin filed an interlocutory application
before the NCLAT, after judgment was reserved in the appeals, offering to
pay ₹15.62 crores to settle the claims of those 55 allottees.
21. However, as noted by the NCLT, no documentary evidence was
produced before it in proof of settlements having been arrived at with any
of the allottees shown as petitioners in the company petition, prior to the
filing thereof. In any event, the day of reckoning stands settled by this
Court in Manish Kumar ( supra ), wherein it was held that the crucial date
for ascertaining whether the threshold is adequately met is the date of
filing of the petition and not the date of the admission or hearing thereof.
22. Another argument that has been fervently urged is that the allottees
could not have made substitutions in the company petition after the filing
thereof on 07.07.2021, even if the same was returned for curing of
defects. It is the admitted position that alterations were, in fact, made in
the cause-title with regard to the names of the allottees who appeared as
petitioners therein and the refiled petition did not reflect the same names
as were there in the petition initially filed on 07.07.2021. As an advance
copy of the earlier petition was sent to the corporate debtors on
07.06.2021, the appellants would contend that such changes were made
without the authority of law. They assert that the same amounts to an
15
abuse of process, warranting rejection of the company petition in limine .
We may note, at this stage, that this argument was not advanced either
before the NCLT or even before the NCLAT. However, we propose to deal
with the same as it touches upon and impacts the maintainability of the
company petition. In this context, Rule 28 of the National Company Law
10
Tribunal Rules, 2016 , assumes significance. It reads as under:
“28. Endorsement and scrutiny of petition or appeal or document.-
(1) The person in charge of the filing counter shall immediately on receipt
of petition or appeal or application or document affix the date stamp of
Tribunal thereon and also on the additional copies of the index and return
the acknowledgement to the party and he shall also affix his initials on
the stamp affixed on the first page of the copies and enter the particulars
of all such documents in the register after daily filing and assign a diary
number which shall be entered below the date stamp and thereafter
cause it to be sent for scrutiny.
(2) If, on scrutiny, the appeal or petition or application or document is
found to be defective, such document shall, after notice to the party, be
returned for compliance and if there is a failure to comply within seven
days from the date of return, the same shall be placed before the
Registrar who may pass appropriate orders.
(3) The Registrar may for sufficient cause return the said document for
rectification or amendment to the party filing the same, and for this
purpose may allow to the party concerned such reasonable time as he
may consider necessary or extend the time for compliance.
(4) Where the party fails to take any step for the removal of the defect
within the time fixed for the same, the Registrar may, for reasons to be
recorded in writing, decline to register the pleading or document.”
23. The above Rule reflects that the registration of the pleading or
document, as the case may be, is to take place only after the removal of
the defects therein. Rule 28(2) makes it clear that if, upon scrutiny, the
appeal or petition or application or document is found to be defective, the
10
For short, ‘NCLT Rules’
16
same should be returned to the party for compliance. However, Rule 28(3)
goes further and states that a party may be allowed to not only rectify but
also amend such returned appeal or petition or application or document.
Rule 28(4) manifests that it is only after the refiling, upon curing of the
defects, that the Registrar would register the pleading or document. Rule
29 of the NCLT Rules is titled ‘Registration of proceedings admitted’ and
states that on admission of an appeal or petition or caveat or application,
the same shall be numbered and registered in the appropriate register
maintained in that behalf and the number shall be entered therein.
24. Ergo , the mere filing of the company petition on 07.07.2021 did not
result in the same being ‘registered’ on the file of the NCLT and it was only
after rectification/amendment of the petition and upon its refiling, with the
defects therein cured, that the same would have been registered. Notably,
in Surendra Trading Company vs. Juggilal Kamlapat Jute Mills
11
Company Limited and others , this Court held that till the objections in
an application filed under Sections 7, 9 or 10 of the Code are removed, it
is not to be treated as an application validly filed, as it is only after the
application is complete in every respect that it is required to be
entertained. Therefore, the alteration in the memorandum of parties in the
company petition after it was filed on 07.07.2021, but returned for curing
11
(2017) 16 SCC 143
17
the defects therein, did not amount to an abuse of process as is being
contended by the appellants. It was only after ‘registration’ of the company
petition takes place under Rule 28(4) of the NCLT Rules that it would have
been impermissible for the petitioning allottees to make any changes
therein without the leave of the NCLT. As the changes in question were
made by them prior to that event, no adverse inference can be drawn
against them to non-suit them on that ground. Reliance placed on Gurdial
12
Singh and others vs. Raj Kumar Aneja and others is of no avail to
the appellants as the ratio laid down therein that a pleading, once filed,
forms part of the Court record and could not be touched/modified/
substituted/amended except with the leave of the Court, has no
application on facts, in the light of the procedure prescribed under the
NCLT Rules.
25. As regards the contention that a joint company petition could not
have been filed for initiation of insolvency process against two separate
companies, we may note that the letter of allotment, in relation to the
leased land, was issued by the UPSIDA on 05.08.2006 in favour of Bhasin
Ltd alone. The project was, therefore, to be undertaken essentially by
Bhasin Ltd. It was only thereafter, i.e., on 14.12.2009, that Bhasin Ltd.
entered into an agreement with Grand Venezia Ltd., granting it marketing
12
(2002) 2 SCC 445
18
rights in relation to the sale of units in the project. It is a matter of record
that the two companies had common directors, including Satinder Singh
Bhasin, for some length of time. Further, demand notices and possession
letters were issued by Bhasin Ltd. to the allottees of Grand Venezia Ltd.
and the correspondence/communications with the allottees were by both
the companies interchangeably. Payment receipts also manifested the
same. These documents formed part of the company petition.
26. Further, in its reply dated 07.07.2022 filed before the NCLT in the
company petition, we find that Grand Venezia Ltd. had stated that it was
a ‘highly reputed marketer’ and had acquired exclusive marketing rights
for selling the units in the commercial complex constructed by Bhasin Ltd.,
vide the Agreement dated 14.12.2009. This claim stands decimated by
the fact that Grand Venezia Ltd. was incorporated and came into
existence only in November, 2009, barely a month earlier. It, therefore,
had no reputation or experience as a marketer, so to speak of, and
appears to have been incorporated only for the purpose of entering into
an agreement with Bhasin Ltd. in relation to the subject project. Before us,
the appellants have stated that Grand Venezia Ltd. purchased 1,114 units
in the project from Bhasin Ltd. on 31.03.2016 for ₹218 crores. There is,
thus, no possibility at this stage for either company to say that they are
not jointly liable to the allottees of the project. The NCLT and the NCLAT
were, therefore, justified in concluding that the corporate debtors were
19
intrinsically linked and that it would be in their interest to have a joint
insolvency process so as to maximise asset realisation.
27. Significantly, in Edelweiss Asset Reconstruction Company Ltd.
( supra ), the NCLAT was dealing with five companies which had jointly
undertaken development of a township. The NCLAT opined that a ‘Group
Corporate Insolvency Resolution Process’ proceeding was required to be
initiated against all five of them in such circumstances. This order stood
confirmed, when Civil Appeal (Diary) No. 1010 of 2020, challenging the
same, was dismissed by this Court on 10.02.2020. Earlier, in Mamatha
13
vs. Amb Infrabuild P. Ltd. and others , the NCLAT had observed that if
two corporate debtors collaborate and form an independent corporate
entity for developing land and allotting premises to allottees, the
application under Section 7 of the Code would be maintainable against
both of them jointly and not individually against one or the other. This
judgment was confirmed by this Court when the Civil Appeal filed by one
of the corporate debtors was dismissed, vide the order reported in AMB
14
Infrabuild P. Ltd. vs. Mamatha and another . The argument that these
were two completely independent and separate companies, therefore,
falls to the ground. In any event, as they were jointly answerable to the
allottees, the filing of a single company petition against them was justified.
13
(2019) 5 Comp Cas-OL 130 = 2018 SCC Online NCLAT 785
14
2019 SCC Online SC 2410
20
28. We may now turn to the claim of the appellants that the construction
was complete and that the units were ready for occupation before the date
of filing of the company petition. According to the UPSIDA, which had
allotted land to Bhasin Ltd. for erecting this project, the construction was
to be put up within 5 years from the date of allotment, which is long past.
The project to be put up on the allotted land was a single project,
rd rd
comprising a mall up to the 3 floor, commercial spaces from the 3 to the
th
15 floor and a hotel in the adjacent structure. As per Clause 3(p) of the
lease deeds dated 23.08.2006 and 30.09.2009, Bhasin Ltd. was required
to construct the buildings on the leased land within 60 calendar months
from the dates on which the lease deeds were executed or such extended
period of time as was allowed by the UPSIDA in writing. The UPSIDA
asserts that the delay in completion of the project and in execution of
tripartite sublease deeds is attributable to the corporate debtors.
29. The UPSIDA claims that the corporate debtors committed default in
payment of its outstanding dues and had not even furnished to it the final
list of allottees. It further stated that it was never called upon to execute
tripartite lease deeds and, on the other hand, Civil Suit No. 257 of 2018
was filed by Bhasin Ltd. challenging the clauses in the lease deeds which
stipulate that such tripartite lease deeds had to be executed. The suit is
stated to be pending. The list of allottees was communicated to the
UPSIDA for the first time under letter dated 18.04.2024 but it was full of
21
discrepancies and the final undisputed list of allottees is yet to be shared
with it. This was stated to be the sine qua non for execution of tripartite
lease deeds. It was stated that the project does not have a final completion
certificate for the entire construction and the hotel part of the project was
not complete. The UPSIDA asserted that the part-completion certificate
was conditional and was not for the whole project. According to it, affidavit
dated 28.01.2022 was filed in the suit, stating that the part-completion
certificates dated 07.05.2011 and 16.04.2015 were ineffective as the
conditions stipulated therein were not complied with. The UPSIDA further
stated that its dues of ₹54.38 crores were payable by Bhasin Ltd. The writ
petition filed against it by Bhasin Ltd. in that regard was dismissed by the
Allahabad High Court on 08.09.2025, granting liberty to the UPSIDA to
approach the Interim Resolution Professional (IRP) to lodge its claim.
30. In this regard, we may note that Regulation 2.16.0 of the Uttar
Pradesh State Industrial Development Area Building Regulations, 2004,
falling in Chapter-2, titled ‘Procedural Requirements for Building
Permission’, deals with ‘Occupancy Certificate’ and states that no building
erected, re-erected or altered, shall be occupied in whole or in part until
the issuance of an Occupancy Certificate by the Authorised Officer in the
form given in Appendix-11. It is an admitted fact that an Occupancy
Certificate in the prescribed format in Appendix-11 has not been issued by
the UPSIDA till date for the project.
22
31. ‘Handing over/Taking over of possession’ letters issued by Bhasin
Ltd. in favour of allottees, recording delivery of possession of particular
units, have been placed on record. However, we find that some of those
st
letters pertain to the 1 floor of the building, with which the petitioning
allottees in the company petition have no concern. Those letters,
therefore, do not further the case of the appellants. A letter was issued in
th
relation to a unit on the 7 floor in favour of one Sheetal Badhwar but the
undertaking of that allottee records that the sublease deed with the
UPSIDA was yet to be executed. Further, notional possession letters were
also issued to allottees, which are of no significance whatsoever. These
so-called letters of actual delivery of physical possession, in our
considered opinion, have no legal import given the categorical stipulation
by the UPSIDA in its allotment letter and also the lease deeds that physical
possession should not be delivered to allottees without execution of the
tripartite sublease deeds.
32. Though the appellants also place reliance on the part-completion
and part-occupancy letters received from the UPSIDA in 2015 and earlier,
coupled with the notional/physical delivery of possession letters issued to
the allottees, the same have to be construed and understood in the
context of the extant legal regime and the contractual clauses between
the parties. The clauses in the allotment letter dated 05.08.2006 and the
clauses in the lease deeds of the UPSIDA made it clear that possession
23
could not be offered to allottees without tripartite sublease deeds being
executed. This was clarified by the Regional Manager of the UPSIDA in
his letter dated 21.02.2023 addressed to one of the allottees under the
Right to Information Act, 2005. He confirmed therein that no tripartite
sublease deed had been executed in favour of any allottee till that date
and in the event the builders had executed sublease deeds directly in
favour of any allottees, the same would be in clear violation of the terms
and conditions of the allotment letter and the lease deeds.
33. We may note that some of the letters issued in the year 2015 by
Bhasin Ltd. merely offered notional possession to the allottees. Letter
dated 13.10.2015 addressed to Kanwaljeet Singh, one such allottee, is
placed on record in this regard. The part-completion/part-occupancy
letters and the notional/physical possession delivery letters issued to the
allottees, therefore, can be taken to be proof of completion of the
construction in all respects, as is being claimed by the appellants. Further,
their claim in that regard is also belied by the Commissioner’s Report
dated 17.05.2018 filed before the High Court of Delhi in an earlier winding-
up proceeding. Therein, the Commissioner had recorded that none of the
units were ready and fit for occupation as on the date of his inspection.
This report formed part of the record before the NCLAT.
34. Though we would have ordinarily restricted the scope of enquiry in
this regard to documents prior to the date of admission of the company
24
petition and which formed part of the record before the NCLT, we may note
that the appellants secured an interim order from the NCLAT on
07.12.2023 by claiming that the construction was complete and that the
units were ready to occupy. This interim order continued to operate for
nearly two years thereafter. It was during the pendency of the proceedings
that the NCLAT undertook the exercise of verifying this claim of the
appellants and appointed an Observer to visit the premises and submit a
report as to the situation actually obtaining. It was pursuant thereto that
the Observer’s Report dated 15.05.2025 came to be filed before the
NCLAT leading to the dismissal of the appeals on 29.10.2025. We are,
therefore, of the opinion that this report also warrants examination.
35. In his report dated 15.05.2025, the Observer stated that he had
visited the subject premises on 10.05.2025, accompanied by the
representatives of the suspended management of the corporate debtors,
th
the financial creditors and the UPSIDA. With regard to the units on the 9 ,
th th th th
10 , 11 , 12 and 14 floors, the Observer noted that only 1 out of the 6
lifts in the office building/commercial tower was working but that lift also
th
had accessibility only till the 9 floor. On that floor, the Observer found that
no units had been constructed and was told by the representative of the
th
suspended management that no units had been constructed on the 9
th
floor and above till the terrace, i.e., the 15 floor. As regards the units on
rd th th th th th
the 3 , 4 , 5 , 6 , 7 and 8 floors, the Observer noted that upon reaching
25
th
the 8 floor, he found that the said floor was partly constructed but lacked
basic amenities such as bathrooms, lighting, air-conditioning, etc. No fire
safety equipment was installed on the said floor. Similar was the situation
th th th th
with the 5 , 6 and 7 floors. On the 4 floor, the Observer found that the
unit walls were made of gypsum-like material and not brick. Again, basic
amenities were missing and the Observer opined that it would not be
possible to hand over immediate possession to the allotees of the units
rd
on this floor. The units on the 3 floor were also found to be in the same
condition, as some units did not have partitions between them and a lot of
construction material was stored in one unit. He concluded that, at
present, the commercial tower/office building integrated with the mall was
only partially built and lacked basic amenities. He further stated that the
units situated on all the floors required substantial amount of work to be
done before giving possession to the allotees in a fit and proper state. The
rd
pictures appended to the Observer’s Report in relation to the 3 floor show
that there is no possibility of actual physical possession being delivered of
any unit on that floor to the allotees.
36. Viewed thus in totality, the contention of the appellants that the
construction was completed in all respects and possession was delivered
to some of the petitioning allottees is found to be without merit and factual
foundation. Notwithstanding the letters and documents sought to be relied
upon in that regard, the ground reality is otherwise. Neither has the
26
construction been completed nor could possession of units be delivered
to the allottees without fulfilling all necessary formalities in that regard after
completion of the building in all respects.
37. On the above analysis, we hold that the company petition instituted
under Section 7 of the Code against both the corporate debtors by the
allottees of 103 units was maintainable on all counts. The petitioning
allottees duly established their financial debt and also the default in
connection therewith, inasmuch as the units for which they had paid
valuable consideration were not made ready and delivered to them till
date. We, accordingly, find no error having been committed either by the
NCLT in admitting the company petition or by the NCLAT in confirming the
same in appeal. Hence, Civil Appeal Nos. 13779 and 13812 of 2025 are
bereft of merit and deserve to be dismissed.
38. Insofar as Civil Appeal No. 13628 of 2025 is concerned, the offer
made by Satinder Singh Bhasin, the appellant therein, to deposit a sum
of ₹15.62 crores was based on the premise that the said amount would
suffice to settle the claims of the 55 alleged allottees who, according to
him, still remained in the fray after settlement of the claims of the other
petitioning allottees in the company petition. In the light of what has been
stated by the NCLT and the NCLAT and what we have recorded
hereinabove, this premise is itself found to be without basis. Therefore,
the order passed by the NCLAT rejecting the offer made by Satinder Singh
27
Bhasin, vide the order dated 07.10.2025, does not warrant interference
either on facts or in law. This appeal is equally devoid of merit.
All the three appeals are, accordingly, dismissed.
Pending applications shall also stand dismissed.
.............................., J.
SANJAY KUMAR
..............................., J.
K. VINOD CHANDRAN
January 2, 2026
New Delhi.
28