# In the matter of Sidhartha Buildhome Private Limited IA No. 3024-ND-2022 in IB-717-2019

> NCLT judgment dated 2022-11-25. Citation: TCN-2022-NCLT-00346. The application was filed by Home Buyers and Financial Creditors of the Corporate Debtor under…

- **Court:** NCLT
- **Order date:** 25 Nov 2022
- **Citation:** TCN-2022-NCLT-00346
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/sidhartha-buildhome-private-limited-ia-no-3024-nd-2022-in-ib-717-2019-a08ea1b3

## Summary

### Background

The application was filed by Home Buyers and Financial Creditors of the Corporate Debtor under Section 60 (5) of the Insolvency & Bankruptcy Code, 2016, seeking a declaration that Mr. Siddharth Chauhan, being a promoter of the Corporate Debtor, is ineligible to present the Resolution Plan and to prevent voting on the Resolution Plan presented by him. The applicants argued that despite the promoter/suspended director being ineligible under Section 29-A of the IBC, the resolution plan proposed by him was being tabled for discussion by the Resolution Professional. The applicants, being home buyers and financial creditors, had invested their life savings in the project promoted by the Corporate Debtor. They sought a declaration from the Adjudicating Authority that Mr.

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## Facts

The Corporate Debtor, Sidhartha Buildhome Private Limited, underwent Corporate Insolvency Resolution Process (CIRP). The application was filed by Home Buyers and Financial Creditors. The promoter of the Corporate Debtor, Mr. Siddharth Chauhan, submitted a Resolution Plan. The applicants contended that Mr. Chauhan was ineligible to present a Resolution Plan under Section 29A of the Insolvency and Bankruptcy Code (IBC). The Corporate Debtor's account was declared a Non-Performing Asset (NPA) by the Financial Creditor during Mr. Chauhan's management. The Corporate Debtor allegedly undertook preferential, undervalued, and fraudulent transactions. A Transaction Audit Report dated 02.08.2021 highlighted these transactions. The Resolution Professional (RP) permitted Mr.

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## Issues and analysis

### Issue 1: Whether Mr. Siddharth Chauhan, being a promoter of the Corporate Debtor, is ineligible to present …

**Ratio:** Section 29A of the Insolvency and Bankruptcy Code, 2016 disqualifies certain individuals

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**Reasoning:** The court reasoned that Mr. Siddharth Chauhan, as the promoter and suspended director of

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**Interpretation:** Section 29A is interpreted strictly to prevent individuals who have contributed

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**Application:** In this case, the court applied Section 29A to the facts and found that Mr.

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## Parties

- **Judges:** BACHU VENKAT…; BINOD KUMAR…
- **Appellants:** Harbans Singh &…
- **Respondents:** Sidhartha…; Devender Singh &…

## Timeline

- **2021-08-02 — Transaction Aud…**: Transaction Audit Report dated 02.08.2021 highlighted preferential, undervalued, and…
- **2021-11-23 — MSME Certificate…**: The Corporate Debtor obtained an MSME certificate on 23.11.2021 through Mr. Sarjeet, an…

## 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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