Case Note & Summary
The appeal was filed against the order dated 15.05.2026, where the Adjudicating Authority admitted a Section 7 application by Avenue 54 Welfare Association. The earlier proceedings involved two appeals by the promoters of the Corporate Debtor, which were dismissed by the Tribunal on 26.11.2025, allowing the Avenue 54 Welfare Association to file individual affidavits from homebuyers. Following this, the Adjudicating Authority received the affidavits and framed an issue regarding compliance, ultimately finding that the requirements were met. The Appellant challenged the order, citing discrepancies in the affidavits of nine unitholders, but the Respondent maintained that the majority of flat buyers had authorized the application. The Tribunal noted that the discrepancies did not affect the maintainability of the application, as 98 out of 152 sold units had filed affidavits. The Tribunal dismissed the appeal, affirming the Adjudicating Authority's findings and the initiation of CIRP proceedings.
Headnote
A) Insolvency Law - Admission of Section 7 Application - Maintainability of Application - Insolvency and Bankruptcy Code, 2016, Section 7 - The Adjudicating Authority admitted the Section 7 application despite discrepancies in some affidavits, as the majority of homebuyers had complied with the requirement to file individual affidavits. The Tribunal found no grounds to interfere with the Adjudicating Authority's decision to initiate Corporate Insolvency Resolution Process (CIRP) proceedings based on the evidence presented (Paras 5-10).
Issue of Consideration
Whether the admission of the Section 7 application by the Adjudicating Authority was justified despite discrepancies in some affidavits.
Final Decision
The appeal was dismissed, affirming the Adjudicating Authority's order admitting the Section 7 application and initiating CIRP proceedings.
Law Points
- Insolvency proceedings
- Section 7 application
- maintainability
- individual affidavits
- compliance
Case Details
2026 LawText (NCLAT) (05) 165
Comp. App. (AT) (Ins) No. 966 of 2026
Justice Ashok Bhushan, Indevar Pandey
Mr. Gaurav Mitra, Ms. Neeha Nagpal, Mr. Ajatshatru Singh Rawat, Mr. Ishit Patel, Ms. Lavanya, Ms. Aishwarya Modi, Mr. Abhijeet Sinha, Mr. Rakesh Gupta
Avenue 54 Welfare Association & Anr.
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Nature of Litigation
Appeal against the admission of a Section 7 application under the Insolvency and Bankruptcy Code.
Remedy Sought
The Appellant sought to challenge the admission of the Section 7 application.
Filing Reason
The Avenue 54 Welfare Association filed the application for initiation of Corporate Insolvency Resolution Process.
Previous Decisions
The Tribunal had previously dismissed appeals by the promoters of the Corporate Debtor regarding the same matter.
Issues
Whether discrepancies in affidavits affect the maintainability of the Section 7 application
Whether the Adjudicating Authority's findings were justified
Submissions/Arguments
The Appellant argued that discrepancies in affidavits of 9 unitholders affected the application.
The Respondent contended that the majority of homebuyers had complied with the affidavit requirement.
Ratio Decidendi
The Tribunal held that minor discrepancies in some affidavits do not undermine the overall compliance of the majority of homebuyers, thus supporting the maintainability of the Section 7 application.
Judgment Excerpts
The order dated 12.09.2025 passed in I.A.5195/2024 and I.A.6034/2024 is not interfered with for the reasons as indicated above.
On the ground of some discrepancies in 9 affidavits, we do not find any ground to interfere with the order by which the Adjudicating Authority has found debt and default.
Procedural History
The appeal was filed against the order admitting the Section 7 application after prior appeals were dismissed by the Tribunal, which allowed the Avenue 54 Welfare Association to file individual affidavits.
Acts & Sections
- Insolvency and Bankruptcy Code: Section 7
