Comparative Reach Of Other Newspapers Irrelevant For CIRP Public Announcement Compliance: NCLT Mumbai

The National Company Law Tribunal (NCLT), Mumbai, dismissed applications filed by four homebuyers and one operational creditor of Calyx Lenora Realty LLP seeking condonation of delay and admission of claims filed more than 500 days after the prescribed deadline.

The tribunal held that the public announcement complied with the Corporate Insolvency Resolution Process (CIRP) Regulations despite the applicants' contention that the newspapers chosen did not have sufficiently wide circulation.

A bench of Technical Member Anil Raj Chellan and Judicial Member K.R. Saji Kumar observed:

"In our opinion, the comparative reach of other newspapers is not relevant for the purpose of compliance under the CIRP Regulations. What matters is whether the publications possess adequate circulation in terms of both the number of copies and geographical coverage within the area. The fact that 200 homebuyers have filed their claims in response to the publication made by the Respondent indicates that the publication reached a broad audience in the locality."

The Corporate Debtor was admitted into CIRP on June 6, 2023. The Resolution Professional (RP) issued the public announcement on June 16, 2023. The CIRP was extended to nearly 570 days. Thereafter, the Committee of Creditors (CoC) approved the resolution plan with 100% voting on November 21, 2024.

The applicants submitted their claims only between February and May 2025. They contended that they were unaware of the CIRP. They also argued that the newspapers chosen for the public announcement did not have sufficiently wide circulation.

Rejecting the contention regarding individual notices, the tribunal accepted the RP's submission that he had not received the Corporate Debtor's books of accounts from the suspended directors. The tribunal held that, in such circumstances, Regulation 6A did not require the RP to issue individual communications. The public announcement was therefore deemed to have been communicated to the creditors.

"Conversely, the RP asserts that he was not in a position to give individual notices as he did not receive any books of accounts from the suspended directors. Furthermore, Regulation 6A clearly stipulates that the communication is to be sent as per the latest available books of accounts of the Corporate Debtor. Therefore, in the absence of such books, RP has no obligation to send the individual communication to the creditors."

The tribunal also noted that the CoC comprised a financial creditor holding 58.45% voting share and homebuyers holding 41.55% voting share. The admitted claims included those of 196 homebuyers.

Since the resolution plan had been approved unanimously, permitting fresh claims would create uncertainty. It would also necessitate a fresh CIRP. The tribunal observed that this would frustrate the Code's time-bound resolution framework.

Holding that the applicants had failed to act diligently and that no exceptional circumstances justified the delay, the tribunal observed that mere technical objections, without showing how they affected the spirit or intent of the Insolvency and Bankruptcy Code, could not defeat the insolvency resolution process.

Accordingly, the tribunal dismissed all five applications.

For Applicant: Advocate Karan Gajra along with Advocate Sanchita Sontakke

For Homebuyer: CS Pramodkumar Ladda

For Respondent: CS Devarajan Raman a/w Adv. Hasti Bhanushali