NCLAT closes insolvency proceedings against Marvel Realtors & Developers

The National Company Law Appellate Tribunal (NCLAT) has closed the Corporate Insolvency Resolution Process (CIRP) against Marvel Realtors & Developers Ltd. after taking on record settlement with its financial creditor.

A two-member bench of NCLAT headed by Chairperson Ashok Bhushan said that the realtor has submitted a settlement letter dated 08th May 2023 with its financial creditor, IDFC First Bank.

"We take the settlement letter dated May 8, 2023, on record, close the CIRP against the corporate debtor, setting aside the Order dated December 23, 2022," said NCLAT order. Moreover, it also rejected the plea of Catalyst Trusteeship, which had filed an intervention application opposing the withdrawal of CIRP against Marvel Realtors & Developers. "Intervener is at liberty to take its own proceeding in accordance with the law to protect it," it said.

The appellate tribunal observed that in the present case, a Committee of Creditors (CoC) has not yet been constituted and rejected the claims of the intervener opposing withdrawal of CIRP.

The appellate tribunal said it was of the view that, on account of the objection raised by the intervener of his filing claim before the IRP, the CIRP can not be allowed to proceed since the debt for which CIRP has been initiated, has been settled with the Financial Creditor."The intervener is free to take such legal proceedings as may be advised to protect his interest," it said.

NCLAT direction came over the plea filed by Vishwajeet Subhash Jhavar, erstwhile Director of the suspended board of Marvel Realtors & Developers Ltd. The Mumbai-based bench of the National Company Law Tribunal (NCLT) had on December 23, 2022, directed to initiate insolvency proceedings against Marvel Realtors & Developers over the plea filed by IDFC First Bank.

Later on January 4, 2023, the director approached NCLAT and submitted that a settlement proposal to the bank was already given. This was also confirmed by the bank, which submitted that the said settlement proposal is under active consideration of the management.

Following this NCLAT stayed on the constitution of the CoC, directing IRP to run the company as a going concern and carry all such business which is normal business. According to reports, lender had approached NCLAT after a default of over Rs 44.50 crore.