# In the matter of Ornate Spaces Private Limited

> NCLT judgment dated 2023-10-06. Citation: TCN-2023-NCLT-01345. Aarif Ahsan Khan filed an application under Section 60(5) of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 6 Oct 2023
- **Citation:** TCN-2023-NCLT-01345
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/ornate-spaces-private-limited-09896403

## Summary

### Background

Aarif Ahsan Khan filed an application under Section 60(5) of the Insolvency and Bankruptcy Code, 2016, against the partial rejection of his claims by the Resolution Professional (RP). Khan, a homebuyer in 'The Grove Towers' project developed by Ornate Spaces Private Limited (Corporate Debtor), sought directions for the RP to accept his claim as a 'Homebuyer'. The RP partially accepted Khan's claim, leading to the application before the NCLT.

## Facts

Aarif Ahsan Khan, a homebuyer, booked two flats (No. 2907 and 3007) in 'The Grove Towers' project developed by Ornate Spaces Private Limited. He made payments totaling Rs. 1,05,00,000 for Flat No. 2907 and Rs. 3,33,00,000 for Flat No. 3007. Some payments were made directly to the Corporate Debtor, while others were made to Ornate Developers, allegedly on the instructions of the Corporate Debtor's director. The Resolution Professional (RP) partially accepted Khan's claim, admitting amounts paid directly to the Corporate Debtor but rejecting amounts paid to Ornate Developers. Bank statements revealed that the funds used by Khan to make these payments were received from Ornate Spaces Pvt. Ltd. and Aryan Spaces, raising suspicion of fund diversion from the Corporate

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## Issues and analysis

### Issue 1: Whether the Resolution Professional (RP) was justified in partially rejecting the claims of the …

**Ratio:** The Resolution Professional has a duty to verify the authenticity and legitimacy of

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**Reasoning:** The NCLT found that the funds used by the Applicant to book the flats were received from

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**Interpretation:** The IBC requires the RP to conduct a thorough investigation of claims to

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**Application:** In this case, the NCLT directed the RP to re-evaluate the evidence and

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## Parties

- **Judges:** Prabhat…; KISHORE VEMULAPALL…
- **Appellants:** Aarif Ahsa…
- **Respondents:** Ornate Spaces…; Jayesh Sangharajak…

## Timeline

- **2016-01-01 — Enactment of Insolvency…**: The Insolvency and…
- **2018-03-27 — Provisional Allotment…**: Provisional allotment letter dated…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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