# In the matter of Grandstar Realty Private Limited

> NCLT judgment dated 2023-09-26. Citation: TCN-2023-NCLT-01464. The case involves an application filed by Manab Datta & Ors under Section 7 of the Insolvency…

- **Court:** NCLT
- **Order date:** 26 Sept 2023
- **Citation:** TCN-2023-NCLT-01464
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/grandstar-realty-private-limited-37286cbd

## Summary

### Background

The case involves an application filed by Manab Datta & Ors under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Grandstar Reality Private Limited for alleged default of Rs. 78,09,94,385.56. The applicants, homebuyers in the 'Akme Raaga' project, claim to constitute more than 10% of the total allottees. The corporate debtor, Grandstar Realty, purchased the property 'as is where is' from Yes Bank, which had previously extended a loan to Akme Projects Limited (the original borrower). The original borrower defaulted, leading to the property's sale to Grandstar. The applicants allege that Grandstar failed to deliver possession of the flats and pay delay charges.

## Facts

Manab Datta & Ors, representing 53 homebuyers, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Grandstar Reality Private Limited, claiming a default of Rs. 78,09,94,385.56. The homebuyers had entered into flat buyer agreements with Akme Projects Limited (the original borrower) for units in the 'Akme Raaga' project. Yes Bank had extended a loan of INR 60 crores to Akme Projects Limited, secured by an equitable mortgage on the project land. Akme Projects Limited defaulted on the loan, leading Yes Bank to declare the account as NPA and initiate SARFAESI proceedings. Yes Bank issued a sale notice on 02.04.2016, selling the property to Grandstar Reality Private Limited 'as is where is' in June 2016. The sale confirmation dated

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## Issues and analysis

### Issue 1: Whether the present petition …

**Ratio:** The cause of action for homebuyers continues until actual delivery of possession. Section

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**Reasoning:** The court observed that the cause of action or default in a case of homebuyers continues

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**Interpretation:** The court interpreted that the limitation period for homebuyers filing a

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**Application:** The court found that the application was not barred by limitation because the

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## Parties

- **Judges:** P.S.N. P…; BINOD KUMAR…
- **Appellants:** Manab D…
- **Respondents:** Grandstar Reality…; Grandstar Reality…
- **Advocates:** Shreya Ma…; Arveena S…; +1 more

## Timeline

- **2011-05-01 — Incorporation of…**: Grandstar Realty Private…
- **N/A — Loan to Akme Projects…**: Yes Bank granted a loan of INR 60 crores to Akme Projects Limited for the 'Akme Raaga'…

## 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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