Publication of List of Financial Creditors under IBC Cannot Be Reduced to a Meaningless Formality: Supreme Court

The Supreme Court on September 9, 2025 held that the publication of the list of financial creditors under the Insolvency and Bankruptcy Code, 2016 is an act in discharge of statutory duty by the Resolution Professional and cannot be reduced to a meaningless formality.

A Bench of Justices Sanjay Kumar and Satish Chandra Sharma allowed an appeal filed by Amit Nehra and another, residents of Bengaluru, challenging the National Company Law Appellate Tribunal’s order of January 10, 2025. The NCLAT had affirmed the decision of the National Company Law Tribunal rejecting their claim for possession of a residential apartment in the real estate project of M/s Puma Realtors Private Limited, the corporate debtor.

Setting aside the orders of the NCLAT and NCLT, the Court observed that the appellants had paid nearly the entire sale consideration as far back as 2011. To deny them possession today, despite their claim having been duly verified and admitted, would cause unfair and unwarranted prejudice.

The appellants, allottees of an apartment in the project IREO Rise (Gardenia), Mohali developed by the erstwhile corporate debtor M/s Puma Realtors Pvt Ltd, had paid in 2010 a sum of Rs 57,56,684 out of the total consideration of Rs 60,06,368. Their claim was initially submitted on January 11, 2019 in physical form at the project office at Mohali. Pursuant to an email from the Resolution Professional dated January 31, 2020 inviting homebuyers who had not filed claims to do so, they resubmitted their Form-CA on February 7, 2020 by way of email.

Their claim was duly verified, admitted, and incorporated in the list of financial creditors published on April 30, 2020 at Serial No. 636. Despite this, the Resolution Professional and the Successful Resolution Applicant argued that the appellants had failed to file a valid claim within the statutory timelines prescribed under the Code and the public announcement, and they denied physical filing of the form at the Mohali address.

The Court held that once verification and incorporation in the list occurred, the claim acquired full legal recognition within the corporate insolvency resolution process. It rejected the approach of the NCLAT which had brushed aside this admitted position and treated the appellants as if they had not filed any claim at all.

The Bench clarified that this was not a case of entertaining a fresh claim beyond the resolution plan but one where an allottee’s claim was verified and admitted by the Resolution Professional and reflected in the list of financial creditors before the plan was approved by the Adjudicating Authority. To disregard such an admitted claim and confine the appellants to the limited benefit under Clause 18.4(xi) of the resolution plan would be a misapplication. Clause 18.4 itself distinguishes verified claims from belated or unverified claims and obliterating that distinction would render the scheme otiose. The Court added that relegating bona fide allottees, who have paid substantial consideration years in advance, to the status of mere refund claimants would run contrary to the legislative framework.

As final relief, the Supreme Court directed the respondents to execute the conveyance deed and hand over possession of apartment No. GBD-00-001, Block D, IREO Rise (Gardenia), Mohali to the appellants within a period of two months.

Case Title: Amit Nehra & Anr v. Pawan Kumar Garg & Ors

Bench: Justice Sanjay Kumar and Justice Satish Chandra Sharma

Date of Judgment: September 9, 2025