01Facts
The Corporate Debtor (CD), M/s. Raheja Developers Ltd., launched an affordable group housing project named "Raheja Krishna Housing Scheme" in Gurugram
¶ 2(ii)-(iii)Under the Builder Buyer Agreement, possession was to be delivered by June 10, 2019
¶ 2(v)Upon default, 130 homebuyers (Financial Creditors in a class) filed a Section 7 application under the IBC
¶ 2(vi)The Adjudicating Authority (NCLT) admitted the CD into Corporate Insolvency Resolution Process (CIRP) on August 21, 2025
¶ 1The Appellant, a suspended director of the CD, challenged this order, proposing a settlement to refund the homebuyers with 9% interest
¶ 16(xvi)Simultaneously, various financial institutions (PNB, Edelweiss) and allottees from other projects sought intervention, arguing that the CIRP should encompass the entire company due to widespread defaults
¶ 5-802Issues
i.1. Whether the Corporate Insolvency Resolution Process (CIRP) initiated against the Corporate Debtor should be confined specifically to the "Raheja Krishna Housing Scheme" project.
¶ 2(xxii) / para 11ii.2. Whether the claims of financial institutions and intervenors regarding other projects should be entertained within the current insolvency proceedings.
¶ 1803Law Applied
Section 7 of the Insolvency and Bankruptcy Code, 2016, regarding the initiation of CIRP by financial creditors
¶ 1Supreme Court's precedent in Mansi Brar Fernandes v. Shubha Sharma & Anr. (2025), which established that real estate insolvency should, as a rule, proceed on a project-specific basis rather than against the entire Corporate Debtor to protect solvent projects and genuine homebuyers
¶ 14Navin M. Raheja v. Vipul Jain & Ors. (2026), involving the same Corporate Debtor, where it was held that CIRP initiated by allottees of one project must be limited to that specific project to avoid jeopardizing other stakeholders
¶ 13, 1704Reasoning
The court observed that the Section 7 applicants were exclusively allottees of the "Raheja Krishna Housing Scheme" and the default was project-specific
¶ 10-11Applying the principle of "Project-Wise CIRP," the court reasoned that subjecting the CD’s entire infrastructure and multiple projects to a collective insolvency process would cause "collateral prejudice" to homebuyers of other projects that might be viable
¶ 14-15The court noted that the IBC is a forum of last resort for revival, not a mere debt recovery mechanism; therefore, a balanced judicial approach is required
¶ 13Regarding intervenors like PNB and Edelweiss, the court determined that since the CIRP is now project-specific, the Interim Resolution Professional (IRP) must only accept claims pertaining to the "Krishna Housing Scheme"
¶ 18Financial creditors of other projects remain free to pursue independent legal remedies, ensuring that the insolvency of one project does not stall the development of others
¶ 18-1905Holding
The NCLAT modified the NCLT's order dated August 21, 2025, and held that the CIRP against M/s. Raheja Developers Ltd. shall be confined strictly to the "Raheja Krishna Housing Scheme" project
¶ 19(i)The IRP was directed to issue a corrigendum to the public announcement in ‘Form-A’ to invite claims specifically for this project within 14 days
¶ 19(ii)The court granted liberty to Respondents 1 to 130 to file a Section 12A application if a settlement is reached
¶ 19(v)It further clarified that other creditors and financial institutions are free to prosecute independent proceedings regarding other projects, unaffected by this project-specific CIRP
¶ 19(iv)Original Court PDF
Navin M RahejavsShravan Minocha And Ors & Ors.
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