NCLT Mumbai Approves ₹1,611-Crore Resolution Plan For Gstaad Hotels, Dismisses Objections

The Mumbai bench of the National Company Law Tribunal has approved Shree Naman Developers Private Limited's ₹1,611-crore resolution plan for Gstaad Hotels Private Limited.

Gstaad Hotels owns the JW Marriott hotel in Bengaluru

It also dismissed objections raised by suspended directors Deepak B. Raheja and Anita D. Raheja.

The bench comprising Judicial Member Sushil Mahadeorao Kochey and Technical Member Prabhat Kumar ruled that the plan complied with the requirements of the Insolvency and Bankruptcy Code.

It also found no basis for judicial interference with the Committee of Creditors' commercial decision, which was approved with 98.96% of the voting share.

The plan provides for total resolution consideration of ₹1,611 crore. It proposes to revive Gstaad Hotels as a going concern, redevelop its hotel premises into a high-end mixed-use property, and infuse additional funds. It also provides for full payment of admitted operational creditor claims and arrangements for management and supervision of the corporate debtor after approval.

The suspended directors opposed the plan, alleging that the CoC was improperly constituted and that related-party issues had not been fully resolved. They also questioned the admission of Omkara Assets Reconstruction Private Limited's claim, including interest and other charges.

Their objections also covered security trustee arrangements, recoveries from avoidance proceedings, shareholder interests, claim verification, and CIRP costs. They alleged that the resolution professional had failed to preserve the corporate debtor as a going concern.

The tribunal rejected the challenge to Omkara's claim. It noted that the claim had been admitted on the basis of the working contained in a report by Mukund M. Chitale & Co. The tribunal further noted that the objectors had not pointed out any misapplication of the interest or appropriation provisions in the report.

On the related-party issue, the tribunal examined whether Kanazawa Holdings Private Limited and Ahuja Finance Company Private Limited were related parties under the IBC. It concluded that the objections did not establish a defect in the constitution of the CoC.

The tribunal also found objections concerning the security trustee arrangement and perfection of security interests irrelevant in the present case. It noted that all creditors were being paid in full.

Explaining the scope of its review, the tribunal observed that Section 31(1) requires it to examine whether the CoC approved the plan, whether it complies with Section 30(2) and the applicable regulations, and whether it provides an effective implementation mechanism.

The tribunal noted that the ₹1,611-crore consideration substantially exceeded the ₹1,028.33-crore average liquidation value determined by the registered valuers. It found that this demonstrated value maximisation and made the plan commercially more beneficial than liquidation.

It further found the plan viable and feasible, with identified funding sources and arrangements for implementation and supervision. The plan therefore satisfied Section 30(2) and Regulations 37, 38, 38(1A) and 39(4) of the CIRP Regulations. The tribunal approved the plan and dismissed the objection application