The Supreme Court raised serious concerns over delays in approval of insolvency resolution plans by the National Company Law Tribunal (NCLT), while hearing appeals connected to AVJ Developers (India) Pvt. Ltd.
A Bench of Justice J.B. Pardiwala and Justice K.V. Viswanathan said it was unfortunate that a resolution plan approved by the Committee of Creditors (CoC) in July 2024 was still awaiting adjudication before the NCLT Principal Bench, New Delhi.
Background of the Case
Two appeals were placed before the Court. One was filed by the AVJ Heightss Apartment Owners Association, while the connected matter was filed by a suspended director of the corporate debtor company.
Both appeals challenged a common order passed by the National Company Law Appellate Tribunal (NCLAT) on 2 January 2023. The appellate tribunal had upheld an earlier NCLT order directing that the claim of IIFL Finance Limited be considered during the corporate insolvency resolution process of AVJ Developers.
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During the hearing, counsel for the appellants argued that the claim raised by IIFL was not genuine and strongly disputed its basis. The Bench noted that several submissions were made questioning the claim.
The Court also took note of an arbitral award dated 3 July 2024, arising from proceedings initiated regarding IIFL’s claim of Rs 85 crore with interest. Portions of that award were read during the hearing.
The Bench recorded that the arbitral award contained findings on documents, transactions, and loan records relied upon in the dispute. Senior counsel appearing for IIFL informed the Court that the arbitral award has already been challenged before the Delhi High Court under Section 34 of the Arbitration and Conciliation Act.
The Bench then shifted focus to the larger issue of delays in insolvency cases.
“The plan as approved by the CoC is awaiting approval of the adjudicating authority past almost two years,” the Court observed.
It further remarked,
“It is very unfortunate that there is no adjudication on the approval past approximately two years.”
The judges were also informed that many such approval applications are pending before the NCLT Principal Bench, New Delhi, as well as other benches for several years.
The Supreme Court directed the NCLT Principal Bench, New Delhi to provide details on: pending resolution plan approval applications, how long such matters have remained pending, and reasons for delay.
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The Insolvency and Bankruptcy Board of India (IBBI) was also added as a party respondent. The Court directed the regulator to place nationwide figures and statistics on similar pending matters.
Senior advocates Mr. Gopal Jain and Mr. Navin Pahwa were requested to assist the Court as amici curiae.
The matter has been posted for further hearing on 29 April 2026 at 2:00 PM and will continue as part-heard.
Case Details:
Case Title: AVJ Heightss Apartment Owners Association v. IIFL Finance Limited & Anr.
Case Number: Civil Appeal No. 3811/2023 with Diary No. 6520/2023
Judge: Justice J.B. Pardiwala and Justice K.V. Viswanathan
Decision Date: 16 April 2026
