# In the matter of Vinay Jain vs. AVJ Developers (India) Pvt. Ltd.

> NCLAT judgment dated 2023-08-23. Citation: TCN-2023-NCLAT-00254. This case involves an appeal against an order dated April 12, 2023, passed in…

- **Court:** NCLAT
- **Order date:** 23 Aug 2023
- **Citation:** TCN-2023-NCLAT-00254
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/vinay-jain-vs-avj-developers-94972fe1

## Summary

### Background

This case involves an appeal against an order dated April 12, 2023, passed in I.B.-654(PB)/2019, concerning the Corporate Insolvency Resolution Process (CIRP) of AVJ Developers (India) Pvt. Ltd. The CIRP was initiated following an application by a financial creditor, Mr. Vishal Fabrics & Ors. The corporate debtor was involved in a real estate project named AVJ Heights. The appellant, Vinay Jain, is the Successful Resolution Applicant (SRA) and Suspended Director of AVJ Developers. The case history includes the appellant's arrest, rejection of bail by the Allahabad High Court, and subsequent interim bail granted by the Supreme Court to facilitate the construction of remaining flats. The CoC approved the appellant as the provisional resolution applicant and later

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## Facts

The corporate debtor, AVJ Developers (India) Pvt. Ltd., faced CIRP initiated by a financial creditor. The appellant, Vinay Jain, is the suspended director and successful resolution applicant. The corporate debtor was involved in a real estate project, AVJ Heights, where construction of one tower was incomplete, leading to FIRs from homebuyers against the appellant. The appellant was arrested, and his bail application was rejected by the Allahabad High Court, leading to an SLP before the Supreme Court. The Supreme Court granted interim bail to facilitate the construction of remaining flats. The CoC approved the appellant as the provisional resolution applicant and approved the resolution plan with 72.666% vote share. The erstwhile Resolution Professional filed I.A. No.

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority erred in directing the PUFE Transaction Application to be …

**Ratio:** Section 26 of the IBC states that the filing of an avoidance application shall not affect

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**Reasoning:** The NCLAT reasoned that the Adjudicating Authority has the jurisdiction to consider both

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**Interpretation:** The court interpreted Section 26 of the IBC to mean that avoidance applications

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**Application:** The NCLAT applied this reasoning to the present case, stating that there is no

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## Parties

- **Judges:** Ashok Bh…; Barun M…
- **Appellants:** Vinay…
- **Respondents:** AVJ Developers…

## Timeline

- **2019-09-21 — Initiation…**: The Adjudicating Authority initiated Corporate Insolvency Resolution Process (CIRP)…
- **2019-12-24 — Appellant's…**: The Appellant, Vinay…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 26 — Application for avoidance of transactions not to…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-26)

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