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The National Company Law Appellate Tribunal (NCLAT) has dismissed the appeal filed by Ram Kishor Arora, former promoter of Supertech Ltd, challenging the initiation of personal insolvency proceedings against him. The Delhi bench of the National Company Law Tribunal (NCLT) had directed these proceedings in February 2025 following a petition by IFCI, appointing an Interim Resolution Professional (IRP). Arora's counsel argued that the ongoing corporate insolvency proceedings under Section 7 of the Insolvency and Bankruptcy Code (IBC) should preclude personal insolvency actions. However, the NCLAT rejected this argument, stating that the liability of the personal guarantor and the corporate debtor are co-extensive, allowing lenders to proceed against both simultaneously or separately.
In a significant development in the ongoing insolvency proceedings involving Supertech Ltd, the National Company Law Appellate Tribunal (NCLAT) has dismissed the plea filed by Ram Kishor Arora, the former promoter of the real estate firm, challenging the initiation of personal insolvency proceedings against him. Advertisement
Earlier this year, the Delhi bench of the National Company Law Tribunal (NCLT) had directed the initiation of personal insolvency proceedings against Arora under Section 95(1) of the Insolvency and Bankruptcy Code (IBC), following a petition filed by the Industrial Finance Corporation of India (IFCI). The NCLT appointed an Interim Resolution Professional (IRP) to oversee the proceedings.
In his appeal, Arora contended that the ongoing corporate insolvency proceedings against Supertech Ltd under Section 7 of the IBC should preclude the initiation of personal insolvency actions against him. He argued that the liability of the personal guarantor and the corporate debtor are interconnected, and pursuing separate proceedings would be unjust.
However, the NCLAT, in its ruling, rejected this argument, stating that the liability of the personal guarantor and the corporate debtor are co-extensive. The appellate tribunal emphasized that lenders have the right to proceed against both simultaneously or separately, as per the provisions of the IBC.
The NCLAT also noted that Arora had submitted a One-Time Settlement (OTS) proposal to IFCI, which is currently under consideration. The appellate tribunal observed that while the settlement proposal is pending, it does not provide grounds to halt the personal insolvency proceedings.
This development comes amid ongoing efforts to resolve the financial challenges faced by Supertech Ltd. The company has been under corporate insolvency resolution since March 2022, following a default of approximately INR 432 crore to a consortium of banks. The NCLT had appointed an IRP to oversee the affairs of the company, with the objective of resolving its financial distress and protecting the interests of homebuyers and creditors.?
In a related development, earlier this year, the NCLAT appointed state-owned NBCC (India) Ltd to take over and complete 16 delayed housing projects of Supertech Ltd, bringing long-awaited relief to over 42,000 homebuyers who had been awaiting possession of their homes for years. The intervention of NBCC was seen as a necessary step to ensure the completion of these projects and address the grievances of the affected homebuyers.
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