SREI Fin withdraws plea against Nirmal Lifestyle

The debt-laden realty firm Nirmal Lifestyle (Mulund) Pvt Ltd’s one of the secured creditors, SREI Equipment Finance Ltd, has withdrawn it’s appeal before the National Company Law Appellate Tribunal (NCLAT) challenging the resolution plan, after the successful resolution applicant clarified that the disputed mortgaged property was not part of the approved plan.In April, the Mumbai bench of the National Company Law Tribunal had approved the acquisition of Nirmal Lifestyle (Mulund) by a Pune-based developer, Mantra Properties and Developers Pvt Ltd.

The company has admitted liabilities of Rs 1,491 crore, whereas the bidder has proposed Rs 215 crore under the resolution plan to revive the company.Subsequently, the company’s secured creditor, SREI Equipment Finance, had approached the appellate tribunal, through senior counsel Gopal Jain and Ativ Patel of AVP Partners and argued that the plan wrongfully included a property exclusively mortgaged to it.Counsels for Srei argued that the asset had been charged in its favour through a mortgage deed executed on September 18, 2019, against two loans of Rs 84.2 crore each.

The company also argued that without hearing it, the property ought not to have been included in the resolution plan.While Akshay Petkar, counsel appearing for Mantra Properties, clarified that the land forming part of the disputed CTS number, identified as Nirmal Olympia II, was outside the scope of the approved resolution plan.After the successful bidder submitted, the division bench of judicial member Justice Yogesh Khanna and technical member Naresh Salecha allowed Srei to withdraw the application challenging the approval of the resolution plan and disposed of the appeal.The company was admitted under the Corporate Insolvency Resolution Process (CIRP) in July 2023, in an application filed by Beacon Trusteeship Ltd.

The company has only two secured financial creditors: Beacon Trusteeship, with admitted liabilities of Rs 902 crore and a 60.54% share in the Committee of Creditors (CoC); and Assets Care and Reconstruction Enterprise Ltd, with admitted debt of Rs 589 crore and the remaining 39.46% share.The resolution professional (RP) had received only three resolution plans, including those from a successful bidder, Mantra Properties and Developers, Vasavi Realty Pvt Ltd and Sardarmal Prithviraj Constructions Private Limited, in consortium with Mr Dharmesh Sardarmal Jain, who is the ex-promoter of the Corporate Debtor. ...