NCLT Indore: Homebuyers’ Rights Cannot Be Defeated by Project Restructuring; Recognises Constitutional Dimension of Right to Shelter

April 7, 2026 : The National Company Law Tribunal (NCLT), Indore Bench, has held that homebuyers cannot be deprived of their rights merely due to internal restructuring or transfer of a real estate project, emphasising that such rights carry a constitutional dimension linked to the right to life under Article 21.

The ruling came in Dr. Shailendra Trivedi v. Chhaya Gupta, RP of JSM Devcons India Pvt. Ltd., where the Tribunal was adjudicating an application filed by a plot purchaser seeking protection of his rights in the “Pinnacle ‘D’ Desire” project during the corporate insolvency resolution process (CIRP) of JSM Devcons India Private Limited.

The applicant contended that he had purchased a residential plot and paid a total consideration of ₹20.40 lakh, partly through banking channels and partly in cash, and relied on an allotment letter dated September 2, 2014 issued under the seal of the corporate debtor. He argued that his rights had crystallised prior to the commencement of CIRP.

The Resolution Professional opposed the claim, asserting that the applicant failed to establish payments to the corporate debtor and that the only verifiable transaction was made to a separate entity, JSM Developers. It was further argued that the alleged cash component remained unsupported by documentary evidence.

The Tribunal, however, observed that the allotment letter issued under the corporate debtor’s seal could not be dismissed on mere denial and prima facie indicated recognition of the applicant’s rights. It held that such a document carries evidentiary value unless disproved with cogent material.

A key issue before the Bench was the transition of the project from JSM Developers, a proprietorship concern, to the corporate debtor. The Tribunal noted that the Resolution Professional failed to clearly explain how the project and its liabilities were transferred, despite being in possession of relevant records. It held that a homebuyer cannot be prejudiced by such internal arrangements, particularly when these facts lie within the exclusive knowledge of the corporate debtor.

Significantly, the Tribunal underscored that the right to shelter forms an integral part of the right to life under Article 21, and therefore, the rights of homebuyers cannot be treated as purely contractual. It observed that homebuyers constitute a vulnerable class whose interests require protection, especially in insolvency proceedings.

On facts, the Tribunal found that the applicant had successfully proved payment of ₹6.93 lakh through banking channels, as reflected in the bank records (also visible in the statement reproduced on page 14 of the order). However, the alleged cash payment of ₹13.47 lakh remained unsubstantiated due to absence of receipts or documentary proof.

Holding that full ownership rights in immovable property are contingent upon payment of the entire consideration, the Tribunal concluded that the applicant could not claim complete title at this stage. Nonetheless, balancing equities, it directed the applicant to deposit the remaining ₹13.47 lakh with the Resolution Professional. Upon such payment, the applicant would be entitled to claim full title and seek possession of the plot.

Accordingly, the Tribunal allowed the application and directed the Resolution Professional to admit the applicant’s claim as a plot buyer, subject to payment of the balance consideration, while clarifying that such rights would remain subject to existing encumbrances, including mortgage rights of the lender bank.

Case Details:
Dr. Shailendra Trivedi v. Chhaya Gupta, RP of JSM Devcons India Pvt. Ltd.
IA No. 157 of 2024 in TP 230 of 2019 [CP(IB) 192 of 2017]
Order dated: 07.04.2026
Coram: Brajendra Mani Tripathi (Member Judicial) and Man Mohan Gupta (Member Technical)