# In the matter of CHD Developers Ltd. (IB)-1775(PB)-2018, (IB)-1081(PB)-2020 & (IBPP)-02(PB)-2022

> NCLT judgment dated 2022-09-05. Citation: TCN-2022-NCLT-01170. The case involves a petition filed under Section 54C of the Insolvency and Bankruptcy Code…

- **Court:** NCLT
- **Order date:** 5 Sept 2022
- **Citation:** TCN-2022-NCLT-01170
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/chd-developers-ltd-ib-1775pb-2018-ib-1081pb-2020-ibpp-02pb-2022-16a197a6

## Summary

### Background

The case involves a petition filed under Section 54C of the Insolvency and Bankruptcy Code (IBC) for pre-packaged insolvency resolution process (PPIRP) by CHD Developers Ltd. The petition was filed due to defaults in completing real estate projects and delivering units to allottees. Prior to this, several Section 7 petitions under IBC were filed by home buyers against CHD Developers. The primary issue is whether the pre-packaged application can be entertained when a Section 7 petition is already pending before the tribunal. The matter was heard on multiple occasions, and arguments were presented by counsels for the corporate debtor, home buyers, and other parties involved.

## Facts

CHD Developers Limited, the corporate debtor, proposed several real estate projects, both commercial and residential. A large number of home buyers showed interest and paid money to CHD Developers for allotment in these projects. CHD Developers defaulted in completing the projects and delivering the units. Several Section 7 petitions were filed by home buyers against CHD Developers. A pre-packaged insolvency resolution process (PPIRP) application was filed by CHD Developers under Section 54C of the IBC. The land in question for one of the projects belongs to M/s. Roots Developers Private Limited, who raised objections. The corporate debtor's counsel stated that the CD does not object to the initiation of CIRP. An earlier bench had reserved orders on a Section 7

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## Issues and analysis

### Issue 1: Whether a pre-packaged application under Chapter III-A of the IBC can be entertained when a Section …

**Ratio:** Section 11A of the IBC guides the Adjudicating Authority on the procedure to be adopted

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**Reasoning:** The Adjudicating Authority interpreted Section 11A(4) to mean that if a Section 7

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**Interpretation:** Section 11A provides a mechanism for prioritizing applications under IBC,

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**Application:** Since the Section 7 application was filed on 21.10.2020, prior to the

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## Parties

- **Judges:** Ramalingam…; Sh. Avinash K.…
- **Respondents:** CHD Developers…; Shailendra Kumar…

## Timeline

- **2020-10-21 — Section 7 Petit…**: Mr. Rajeev Kumra & Ors. filed a Section 7 petition ((IB)-1081(PB)/2020) against CHD…
- **2018-01-01 — Section 7 Petit…**: Mr. Shailendra Kumar Agarwal filed a Section 7 petition ((IB)-1775(PB)/2018) against CHD…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

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