NCLT Approves Withdrawal of Insolvency Proceedings Against Nobility Estates

NCLT Allows Withdrawal of Insolvency Proceedings Against Nobility Estates

The National Company Law Tribunal (NCLT) has allowed the withdrawal of insolvency proceedings against Nobility Estates, the developer of the luxury housing project 'Le Grandiose' in Noida, following a settlement between financial creditors and the erstwhile management. The Delhi-based Principal bench of the NCLT allowed a section 12A application filed by the resolution professional of the realty firm, seeking withdrawal of the Corporate Insolvency Resolution Process (CIRP) against Nobility Estates.

The NCLT directed the handover of the "management and control" of the Corporate Debtor (Nobility Estates) back to its board of directors, which was suspended after the initiation of CIRP against the realty firm. A two-member NCLT bench observed that the proposal for withdrawal of CIRP under section 12A of the Insolvency & Bankruptcy Code (IBC) was followed, as the proposal had been voted by over 90% of the votes of the Committee of Creditors (CoC).

Key Stakeholders in the Settlement

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The settlement was reached after the resolution professional collated the claims of financial and operational creditors and received an offer from the former management on October 10, 2024, for settlement of the case. The erstwhile management had offered Rs 108 crore against the liability of Rs 775 crore owed to ASK Property Investment, and the debt of Rs 220 crore owed to JM Financial was proposed to be settled by the allocation of 37 units in Phase II of the project.

Settlement Terms

As part of the settlement terms, the erstwhile management has undertaken to obtain revalidation of the sanctioned map and renewal of the RERA licence within 120 days of approval of the withdrawal application. The company has also committed to complete Phase II construction within 48 months and provide periodic progress, sales and financial updates to stakeholders. Moreover, an unconditional bank guarantee and adherence to timelines prescribed under the IBC framework were also agreed upon.

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The NCLT approved the settlement on May 5, 2026, and concluded the CIRP against Nobility Estates. The order was passed on the basis of a 14-page document issued by ASK Trusteeship Services Private Limited, along with an accompanying Bank Guarantee dated March 13, 2026.