June 18, 2024: The National Company Law Tribunal (NCLT) has commenced insolvency proceedings against Supertech Realtors, the developer behind the Supernova project which includes residential apartments, office spaces, retail outlets and a luxury hotel. This decision was made by a two-member bench in Delhi, which accepted the insolvency plea from the Bank of Maharashtra due to a default of Rs 168.04 crore. Anju Agarwal has been appointed as the interim resolution professional (IRP), effectively suspending the board of Supertech Realtors, a subsidiary of Supertech, which is also undergoing a Corporate Insolvency Resolution Process (CIRP).
Supertech Realtors is working on the Supernova project, estimated to cost Rs 2,326.14 crore, on a 70,002 square metre plot in Sector 94, Noida. The project plans to feature an 80-floor structure, set to be the tallest in Delhi-NCR at 300 metre high. To finance this project, Supertech Realtors sought Rs 735.58 crore from a consortium of lenders led by Union Bank of India, including a specific request for a Rs 150 crore credit facility from the Bank of Maharashtra, which was approved.
In December 2012, a Rs 150 crore term loan was granted, repayable in quarterly instalments over a total period of 10 years and 4 months, due by March 2023. However, Supertech Realtors failed to adhere to financial commitments, resulting in significant outstanding dues and breaches of the credit agreement. Despite multiple reminders, payments were not made, prompting the Bank of Maharashtra to seek intervention from NCLT.
Supertech Realtors challenged the insolvency plea on technical grounds, arguing inconsistencies in the stated default dates and claiming that the petition was defective and time-barred. The firm also cited economic downturns and disruptions from 2010 to 2015, including issues with landowners, as reasons for their financial difficulties.
Despite these defences, the NCLT determined that the Bank of Maharashtra qualifies as a financial creditor, having provided the loan to Supertech Realtors, and confirmed the existence of both debt and default. The tribunal stated that the initiation of the Insolvency Resolution Process is warranted due to the default and found the bank’s application to be complete. Consequently, the NCLT admitted the application, commencing the CIRP against Supertech Realtors, and imposed a moratorium on all transactions as per the Insolvency and Bankruptcy Code.
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