“Having gone through all the documents and hearing the submissions, we are satislied that it is a fit case for grant of relief,” NCLT said in the order.
On Tuesday, NCLT had initiated insolvency proceedings against MGF on a application under Section 7 of the IBC Code, 2016 filed by The Vilas Condominium Association consisting of homebuyers having 327 units allotted in the name of members of the association.
“Accordingly, the said prayer – to allow and withdraw the Corporate Insolvency Resolution Process of the corporate debtor – MGF Developments Limited as initiated by this Authority is hereby allowed. Consequently, the corporate debtor is now free from the rigors of the CIR,” NCLT order said.
According to the creditor, the default amount is under various heads and includes Rs 11.48 crore of interest-bearing maintenance security collected from the homebuyers and not refunded to the association of homebuyers as per law.
According to the NCLT order, the parties have entered into an amicable Settlement on December 2, and in terms of which amounts have been received by the financial creditor.
“Counsel for the corporate debtor as well as counsel for the financial creditor have confirmed that all the cheque have since been encashed and nothing is payable towards IFMS claimed by the financial creditor under the main petition,” the NCLT said.
The IP has also confirmed that he has received full and final settlement of his dues towards the remuneration in the matter from the corporate debtor and there remains nothing payable to him. He also confirmed that the Committee of Creditors (COC) has not been constituted in the matter till date.
MGF had formed a joint venture with Dubai-based Emaar Properties, which entered India in 2005 making the largest foreign direct investment in the realty sector till then under Emaar MGF Land.
In April 2016, Emaar decided to end the joint venture and two months later, Shravan Gupta, the then executive vice chairman and managing director of the joint venture, resigned. The demerger was approved in July 2018.
Currently, the erstwhile partners are at loggerheads after Emaar accused fraud in joint venture agreements and land deals and filed a petition with the NCLT in November 2019, seeking investigation into its allegations. It has sought bank guarantees of Rs 2,400 crore to secure its losses.