[ecis2016.org] The NCLT has allowed the initiation of insolvency proceedings against real estate firm Emaar MGF Land, after two home buyers filed a petition against the company, for a huge delay in delivery of their housing units
Admitting the insolvency pleas of two home buyers against Emaar MGF Land, a two-member bench headed by National Company Law Tribunal (NCLT) president justice MM Kumar, has appointed Manoj Kumar Anand as the interim resolution professional of the company and directed him to make a public announcement about the development. The tribunal also directed the company, its erstwhile director, promoters or any other person associated with the Emaar MGF Land, to ‘extend every assistance and cooperation to the interim resolution professional’.
The NCLT order came on the plea of two home buyers – Neeraj Gupta and Arti Jain – who had purchased flats at the developer’s Palm Greens, Kherki Daula project, in Gurugram. The real estate firm failed to deliver the project within 36 months to June 2015. Later, the builder also failed to refund the amount, along with the interest. Thereafter, the petitioners approached the NCLT.
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Consenting to them, the NCLT said “The applicant financial creditor has disbursed the money to the respondent corporate debtor (Emaar MGF Land), as a consideration for purchase of the residential flat. Though a considerable long time has lapsed, even the principal amount disbursed has not been repaid by the respondent corporate debtor, as per the provisions of the flat buyer’s agreement.” It further said: “It is accordingly held that respondent corporate debtor has committed default, in repayment of the outstanding financial debt. Accordingly, the present application is admitted.”
In 2005, Dubai-based Emaar Properties entered the Indian real estate market, in partnership with India’s MGF Group and invested Rs 8,500 crores through the joint venture, Emaar MGF Land. However, in April 2016, it decided to end their 11-year-old joint venture. In January 2018, the NCLT approved the proposed demerger scheme of Emaar MGF Land, paving the way for the two JV partners to go separate ways. The demerger process got completed by July 2018.
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