Written Submission On The Behalf of Applicant

TABLE OF CONTENTS
WRITTEN SUBMISSION ON THE BEHALF OF APPLICANT

INDEX OF ABBREVIATION

STATEMENT OF JURISDICTION
THE APPLICANT INVOKES THE JURISDICTION OF NATIONAL COMPANY
LAW TRIBUNAL UNDER SECTION 60(5) of INSOLVENCY AND BANKRUPTXCY
CODE, 2016
THE PARTIES SHALL ACCEPT ANY JUDGMENT OF THE COURT AS FINAL

AND BINDING FOR THEM AND SHALL EXECUTE IT IN ITS ENTIRETY AND IN
GOOD FAITH.

STATEMENT OF FACTS
The applicant humbly states before the National Company Tribunal, Arcadia Bench
(Adjucating Authority)
1. That, Uttam Pradesh shares its borders with the National Capital Region of Arcadia.
People were coming here from different parts of the country and settling in the search
of better livelihood. This led to steep development of such cities, and are now
considered as National Capital Region.
2. That, M/s Kaypee Infratech limited (KIL) was favourite among the homebuyers, and
boasted of having 30,000 homebuyers who had invested in its projects. KIL was not
only involved in real estate business but had stronghold in the cement manufacturing
industry.
3. That, In the year 2018, KIL started defaulting on its loans and its accounts were
declared a non peforming assests by its 13 lenders. After various attempts of
restructuring its debt, in consultation with its lenders failed; one of its lenders (IBDI
Bank Ltd) filed a petition under section 7 of Insolvency and Bankruptcy Code
2016(IBC) before the National Company Law Tribunal, Arcadia bench.
4. That, This petition was admitted by Adjucating Authority and Mr. Manuj Jain was
appointed the Interim Resolution Professional (IRP) to oversee corporate insolvency
resolution process (CIRP) of KIL. The committee of creditors of KIL, as per its
website, FDHC Bank Ltd-10%
CICIC Bank Ltd-5%
IBDI Bank Ltd-23%
Real Estate allotees-62%
Since large no. of Homebuyers, being aware of legal procedures do not come to vote,
on any agenda put before the CoC Mr. Manuj Jain could never get confirmed as
Resolution Professional, but has been peforming all tasks as an IRP with utmost
sincerity and dedication. Mr. Kunal Chatterjee was appointed as an authorized
representative of real estate allotees by Adjudicating Authority.
5. That, Even after best efforts of IRP, KIL was not able to impress any prospective
resolution applicant and is now on the verge of Liquidation. Distraught with such turn
of events, the Homebuyers of KIL formed Kaypee Homebuyers Welfare Association
an association under the provision of Societies Registration Act,1860.

6. That, Homebuyers wrote a representation to IRP, demanding to consider Homebuyers
as secured financial creditors of KIL, and sought an acknowledgement of their
security interest on the website of KIL. They made such a plea in the light of fact that
they have invested their life savings in the projects floated by KIL and are currently
paying EMIs on their house loans along with the burden of rent.
7. That, Appeal was put before the entire CoC, but such suggestion was heavily resisted
by lenders and CoC and it was their stance that IBC does not provide any mechanism
to consider the homebuyers as secured financial creditors of corporate debtor. They
observed that agreement, does not create any right of the homebuyer and KIL,
specifically states that execution of the agreement, does not create any right of
homebuyers, on units booked by them.
8. That, Association filed an application before the adjudicating authority, seeking
directions, that Homebuyers be treated as secured financial creditor of KIL, and their
security interest be acknowledged by the IRP.
9. That, The application was taken up for an admission on the behalf of Association, the
IRP summarily stated that it will abide by the decision ultimately taken by
Adjudicating Authority and that he does not wish to file any reply. At that juncture the
counsels appearing for the lenders in the CoC of KIL, sought the leave of
Adjudicating Authority to file their reply and contest the application of Association.
10. That, the matter is now posted for final arguments before the Adjudicating Authority.

QUESTION PRESENTED
1.Whether the security interest of the Homebuyers exists or not and if exist, then Do the
homebuyers should get the status of secured financial creditor?
2.Whether the voting which was done in absence of homebuyers was fair or if it had been
done in the presence of homebuyers might leads to some other decision?

SUMMARY PLEADING
WHETHER THE SECURITY INTEREST OF THE HOMEBUYERS EXISTS OR

NOT AND IF EXIST, THEN DO THE HOMEBUYERS SHOULD GET THE
STATUS OF SECURED FINANCIAL CREDITOR
1. According to sec 3(31) of IBC, 2016 the definition of security interest is as follows,
“security interest” means right, title or interest or a claim to property, created in
favour of, or provided for a secured creditor by a transaction which secures payment
or performance of an obligation and includes mortgage, charge, hypothecation,
assignment and encumbrance or any other agreement or arrangement securing
payment or performance of any obligation of any person1.
2. The Agreement is a template agreement (“called as Standard T&C”) promising to
execute “lease deed” of 99 years in favour of the homebuyer, after three years in 2016
(that is when the units were promised to be delivered originally). The same
Agreement was used by KIL with all the homebuyers, where the details of the Allotee
and the premises, were on “fill in the blanks” basis.
3. As per Rera act, in sec 18(1)(b) it is stated that, If the promoter fails to complete or is
unable to give possession of an apartment, plot or building,— due to discontinuance
of his business as a developer on account of suspension or revocation of the
registration under this Act or for any other reason, he shall be liable on demand to the
allottees.2
4. In the fact no. 6 it is stated that, the home buyers made such plea in the light of the
fact that they have invested their life savings in the projects floated by KIL and are
currently paying EMIs on their house loans along with added burden of rent. As
30,000 homebuyers had done the investment in the KIL company the council appeals
the court should look after the plea made by the homebuyers to make them the
secured financial creditors.
1
THE INSOLVENCY AND BANKRUPTCY CODE (hereafter referred as IBC) 2016, No. 31 of 2016
2
THE REAL ESTATE (REGULATION AND DEVELOPMENT) ACT, 2016 NO. 16 OF 2016


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TABLE OF CONTENTS

WRITTEN SUBMISSION ON THE BEHALF OF APPLICANT

WRITTEN SUBMISSION ON THE BEHALF OF APPLICANT

THE PARTIES SHALL ACCEPT ANY JUDGMENT OF THE COURT AS FINAL

WRITTEN SUBMISSION ON THE BEHALF OF APPLICANT

WRITTEN SUBMISSION ON THE BEHALF OF APPLICANT

WRITTEN SUBMISSION ON THE BEHALF OF APPLICANT

WRITTEN SUBMISSION ON THE BEHALF OF APPLICANT

WHETHER THE SECURITY INTEREST OF THE HOMEBUYERS EXISTS OR

WRITTEN SUBMISSION ON THE BEHALF OF APPLICANT

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