Universal Buildwell resolution plan approved by NCLT: Key highlights and creditor payouts
The National Company Law Tribunal (NCLT) has approved the Rs 55.6 crore resolution plan for Universal Buildwell Private Limited submitted byUniversal Aura Welfare Association, Universal Greens Buyers Association and Universal Business Park Owners Association, marking a significant step in the corporate insolvency resolution process (CIRP) that began in 2018. The resolution plan has been approved by the committee of creditors with 70.44% votes share.
Key Highlights of the Resolution Plan:
- Revival of Projects: The resolution plan focuses on reviving three projects— Universal Aura, Universal Greens, and Universal Business Park—while proposing the liquidation of five other projects, including Universal Square, Universal Prime, The Pavillion, and Universal Trade Tower.
- Payment to Dissenting Creditors: The plan ensures that dissenting financial creditors, including Kotak Mahindra Bank Limited and Kotak Mahindra Prime Limited, receive their dues in monetary terms within a specified timeline, as mandated by the Supreme Court in the Jaypee Kensington case.
- Liquidation of Unsold Assets: The unsold inventory in the projects will be liquidated, and the proceeds will be distributed among creditors as per the waterfall mechanism under Section 53 of the Insolvency and Bankruptcy Code (IBC).
Creditor Payouts Under the Resolution Plan:
| Category of Stakeholder | Sub-Category | Amount Claimed (₹ Crores) | Amount Admitted (₹ Crores) | Amount Provided Under Plan (₹ Crores) | % of Claim Provided |
| Secured Financial Creditors | Dewan Housing Finance Corporation Limited (DHFL) | 183.20 | 180.61 | 44.81 | 24.81% |
| Kotak Mahindra Bank Limited | 13.93 | 13.93 | 0.82 | 5.85% | |
| Kotak Mahindra Prime Limited | 37.34 | 37.34 | 2.18 | 5.85% | |
| Small Industries Development Bank of India (SIDBI) | 12.42 | 9.47 | – | – | |
| Sunflame Enterprises Private Limited | 12.82 | 12.82 | – | – | |
| Unsecured Financial Creditors | IndusInd Bank Limited | 6.82 | 6.82 | To be addressed in Part-II of the plan | – |
| Axis Bank Limited | 7.81 | 5.37 | To be addressed in Part-II of the plan | – | |
| HDB Financial Services Limited | 5.02 | 4.98 | To be addressed in Part-II of the plan | – | |
| Hero Fincorp Limited | 30.98 | 30.98 | To be addressed in Part-II of the plan | – | |
| Ms. Nisha Singh | 1.51 | 1.51 | 0.23 | 15.23% | |
| Operational Creditors | Government Dues | 171.77 | 117.21 | – | – |
| Employees | 2.18 | 1.99 | 0.40 | 20.10% | |
| Suppliers | 34.68 | 18.13 | 2.31 | 12.74% | |
| Allottees (Homebuyers) | Allottees under Real Estate Projects | 765.71 | 571.71 | Delivery of flats/units | – |
Key Modifications in the Plan:
- Payment to DHFL: ₹44.81 crores will be paid within 180 days of the plan’s approval.
- Payment to Kotak Mahindra Bank and Kotak Prime: ₹3 crores will be paid within 180 days of the plan’s approval.
- Liquidation of Unsold Inventory: The unsold inventory in the Universal Business Park and The Pavillion projects will be liquidated, and the proceeds will be distributed among creditors.
Monitoring Committee:
A Monitoring Committee will be constituted to oversee the implementation of the resolution plan, chaired by a retired judge. The committee will include representatives from the resolution applicant, lenders, and the three buyers’ associations.
Conclusion:
The NCLT’s approval of the resolution plan for Universal Buildwell marks a significant milestone in the insolvency process. The plan ensures that dissenting financial creditors are paid in monetary terms, while the revival of key projects aims to maximize the value of the corporate debtor’s assets. The liquidation of unsold inventory will further ensure that creditors receive their dues as per the provisions of the IBC.
Also See: NCLT orders liquidation of Ernakulam-based Greenlace Builders and Developers
1 thought on “Universal Buildwell resolution plan approved by NCLT: Key highlights and creditor payouts”