Tribunal holds that contractual and regulatory disputes over pre-CIRP charges lie outside its jurisdiction; homebuyers must clear outstanding dues to get possession, but adjudicated delayed possession compensation can be adjusted.
The National Company Law Tribunal (NCLT), New Delhi Bench, delivered a significant judgment on October 5, 2026, in the case of Vibha Narula Gupta and Others versus Mr. Narendra Kumar Sharma, Resolution Professional of Spaze Towers Pvt. Ltd., clarifying the scope of adjudication under the Insolvency and Bankruptcy Code, 2016 (IBC) during Corporate Insolvency Resolution Process (CIRP). The judgment addresses multiple disputes raised by homebuyers of the residential project "Privvy The Address" situated in Gurugram, who sought possession of their flats, execution of conveyance deeds, and waiver or adjustment of several additional charges.
The Applicants, eleven homebuyers, approached the NCLT under Section 60(5) of the IBC seeking directions to the Resolution Professional (RP) to hand over possession of their allotted apartments and execute conveyance deeds within a stipulated time frame, after adjusting or waiving demands they alleged as illegal or unjust. These disputed demands included charges for increase in super area, External Development Charges (EDC), Infrastructure Development Charges (IDC), external electrification, preferential location charges (PLC), club development charges, labour cess, and interest. The Applicants also sought adjustment of Delayed Possession Compensation (DPC) already awarded by the Haryana Real Estate Regulatory Authority (HRERA) in their favor, and for others whose DPC claims were pending adjudication.
The Tribunal noted that these disputes predominantly arose out of builder-buyer agreements and pre-CIRP demands, which were contractual and regulatory in nature. These issues were already agitated and decided by HRERA, a specialized forum constituted to adjudicate disputes between promoters and homebuyers. The Tribunal held that the NCLT does not have jurisdiction under Section 60(5) of the IBC to re-adjudicate or sit in appeal over these contractual disputes, particularly since the appeals against HRERA's orders were either pending or withdrawn.
Further, the NCLT underscored that the commencement of CIRP does not absolve the homebuyers from their contractual payment obligations. The RP cannot be compelled to hand over possession or execute conveyance deeds without receipt of outstanding dues payable for the respective units. Thus, the Applicants must clear all legitimate dues in accordance with the builder-buyer agreements and applicable law to claim possession.
However, the Tribunal carved out an important exception relating to Delayed Possession Compensation. Where HRERA or any competent forum has already finally awarded DPC in favor of a homebuyer, such crystallized amounts must be adjusted or set off against the outstanding dues payable by the concerned allottee. This equitable relief recognizes mutual dealings arising from the same contractual relationship and prevents double liability. The NCLT made clear that it is not determining any fresh entitlement to DPC or extending the period for which it is payable; unadjudicated claims must be pursued before the competent forum.
The Resolution Professional's submissions that he is duty-bound to preserve and realize the assets and receivables of the corporate debtor, and cannot waive pre-CIRP demands solely on the basis of disputes, were accepted by the Tribunal. The NCLT also highlighted that the CIRP process under IBC is summary in nature and does not empower it to adjudicate detailed contractual disputes which fall within the jurisdiction of specialized fora like HRERA.
In conclusion, the NCLT allowed the application only to the limited extent of directing adjustment of the finally adjudicated DPC against outstanding dues, while rejecting other prayers for waiver, set-off, or re-examination of disputed contractual charges. The homebuyers were directed to pay the balance outstanding dues after adjusting the DPC amount, if they seek possession and conveyance formalities. The judgment emphasized that the disposal of this application does not preclude the Applicants from pursuing their remedies before competent forums for any claims not finally adjudicated.
This judgment reiterates the principle that insolvency proceedings cannot be used as a backdoor to reopen or circumvent contractual and regulatory disputes already decided by specialized authorities, and affirms the role of the Resolution Professional in safeguarding creditors' interests during CIRP.
Bottom Line:
Insolvency and Bankruptcy Code, 2016, Section 60(5) - NCLT cannot adjudicate contractual and regulatory disputes between homebuyers and corporate debtor relating to pre-CIRP demands such as super area increase, EDC/IDC, external electrification charges, PLC, club charges, labour cess and interest, especially when such issues were already considered by HRERA - Homebuyers seeking possession during CIRP must clear outstanding dues - However, Delayed Possession Compensation already finally awarded by competent forum can be adjusted/set off against outstanding dues payable for respective units.
Statutory provision(s):
Insolvency and Bankruptcy Code, 2016 Section 60(5); IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 (Regulations 4E and 30C)
Vibha Narula Gupta v. Mr. Narendra Kumar Sharma, (NCLT)(New Delhi) : Law Finder Doc Id # 3001744
