NCLAT Defers Hearing on Property Exclusion Appeal in Maan Sarovar Liquidation

Authority: National Company Law Appellate Tribunal, Chennai Bench

Order Date: August 4, 2026

Case Overview

The National Company Law Appellate Tribunal (NCLAT) at Chennai heard two connected appeals (CA (AT) (CH) (Ins) No. 83/2025 and CA (AT) (CH) (Ins) No. 141/2025) filed by Sri Brindhavan Brick Works, a third party to the liquidation proceedings of Maan Sarovar Properties Development Pvt. Ltd. The appellant challenges the order of the Adjudicating Authority (NCLT) that dismissed its application for excluding its property from the liquidation estate, as published in Form G dated September 9, 2023.

The dispute originates from a Joint Development Agreement (JDA) entered into between the appellant and the corporate debtor (Maan Sarovar Properties) in 2003. According to the appellant, except for the execution of the agreement on May 20, 2019, no further development occurred, leading the appellant to terminate the JDA and cancel the power of attorney given to the corporate debtor.

Maan Sarovar Properties was admitted to Corporate Insolvency Resolution Process (CIRP) under Section 7 of the IBC on July 1, 2022. Initially, the Resolution Practitioner excluded the appellant's asset but later included it, prompting the appellant to file IA 1782/2023 before the Adjudicating Authority for exclusion of its properties from Form G. This application was dismissed by the Adjudicating Authority on February 5, 2025, which order is impugned in CA (AT) (Ins) No. 83/2025.

The second appeal (CA (Ins) No. 141/2025) challenges the Adjudicating Authority's order dated January 6, 2025, which permitted bifurcation of the resolution plan submitted by PRA.

During proceedings, the liquidator's counsel (Mr. PH Arvindh Pandian) presented additional background: the appellant's property was notified for acquisition under the Tamil Nadu Acquisition of Land for Industrial Purposes Act, 1997 in 2005, with proceedings continuing until 2017 when the government dropped the acquisition. The liquidator claimed that before the land acquisition notice, the corporate debtor had incurred approximately ₹3.0 crores for initial land development in 2003-04. The liquidator also argued that the power of attorney granted by the appellant was irrevocable as it was coupled with consideration.

Significantly, the liquidator has already moved an application under Section 33(5) of the IBC seeking leave for arbitration proceedings regarding the termination of the JDA, which was allowed by the Adjudicating Authority on February 10, 2026.

Final Outcome

The NCLAT identified that the crux of the issue—whether the termination of the JDA by the appellant is legally sustainable—is now being addressed through arbitration proceedings initiated by the liquidator. The Tribunal deferred the matter to August 7, 2026, at 12:45 pm to allow the appellant's counsel to obtain instructions on whether to continue prosecuting the appeal given the ongoing arbitration. All interim orders granted by the Tribunal were extended until the next hearing date.

Topics: Insolvency Proceedings, Property Rights Dispute, Joint Development Agreement