Authority: National Company Law Appellate Tribunal, Principal Bench, New Delhi

Order Date: 20 August 2026

Case Overview

This order addresses two connected appeals (Company Appeal (AT) (Insolvency) No. 1540 & 1541 of 2026) filed against an impugned order dated 22 July 2026 from the National Company Law Tribunal (NCLT), Allahabad. The NCLT had rejected Interlocutory Applications No. 563 of 2025 and 564 of 2025 in the main insolvency petition C.P. (IB) No.101/ALD/2022.

The Appellants, Lokesh Garg and Kamal Sahni, had filed applications before the NCLT seeking two primary reliefs. First, they sought a direction for Respondent No. 4, the Uttar Pradesh State Industrial Development Authority (UPSIDA), to execute lease deeds for Plot Nos. F-64/F-68 and F-67. These plots are situated at Industrial Area, Site-I, Bulendshehr Road, Ghaziabad. Second, they requested a clarification that a previous NCLT order dated 23 January 2024 (which granted a stay against future assignment of properties) was not applicable to the properties they had purchased.

The Appellants' counsel argued that they had purchased the superstructure on these plots, paid the consideration, and had sale deeds executed in their favor. Their claim is that these specific plots are not assets of the Corporate Debtor undergoing the Corporate Insolvency Resolution Process (CIRP). The only pending formality was the execution of the lease deed by UPSIDA, which the authority was now refusing, citing the NCLT's stay order from January 2024.

During proceedings, the Appellants' counsel presented a UPSIDA letter dated 11 December 2023, which stated that the transfer of lease for properties F-64, F-67, and F-68 was completed on that date. In contrast, counsel for the Operational Creditor presented a subsequent UPSIDA letter dated 02 May 2024, which indicated that the transfer was not yet complete, creating a factual contradiction for the Tribunal to resolve.

Final Outcome

The NCLAT admitted the appeals and issued notices to the respondents. UPSIDA was specifically directed to file a reply within two weeks, in which it must clarify the discrepancy between its own letters dated 11 December 2023 and 02 May 2024 regarding the status of the lease transfer. Rejoinders are to be filed within two weeks after that. The matter was listed for the next hearing on 22 September 2026.

Critically, the Tribunal passed an interim order stating that the Resolution Professional (Respondent No. 1) shall not take possession of the three disputed plots (F-64, F-67, and F-68) during this period. The order explicitly states that this should not be construed as a stay on the overall CIRP proceedings pending before the NCLT.

Topics: Insolvency Litigation, Asset Ownership Dispute, Leasehold Rights