NCLT Dismisses Cynosure Real Estates Recall Petitions

Authority: National Company Law Tribunal, New Delhi Principal Bench

Order Date: 16.07.2026

Case Overview

This order pertains to two Interlocutory Applications (IA-05/2023 and IA-06/2023) filed by Amarendera Financial Pvt. Ltd. and Dinkar Commercial Pvt. Ltd. (the Applicants) seeking the recall of an order dated 19.04.2022. In that original order, the NCLT had dismissed the Applicants' separate petitions under Section 7 of the Insolvency & Bankruptcy Code, 2016, which sought to initiate Corporate Insolvency Resolution Process (CIRP) against Cynosure Real Estates Pvt. Ltd. (the Corporate Debtor).

The Applicants alleged that the 2022 order was obtained by fraud, claiming the Corporate Debtor had failed to produce its Income Tax Return for the Assessment Year 2018-19 and subsequent balance sheets, which they argued would have contained an acknowledgment of the financial debt. The Applicants cited purported fund transfers of ₹1.70 Crore (₹1.5 Crore on 05.04.2017 and ₹20 Lakh on 06.04.2017) as evidence of the debt but had not provided a formal loan agreement or certified bank statements in the original proceedings.

The Tribunal heard arguments from the Applicants' counsel, who relied on judicial precedents, including Greater Noida Industrial Development Authority v. Prabhjit Singh Soni & Anr. (2024 INSC 102) and Union Bank of India v. Dinkar T. Venkatasubramanian & Ors., to assert the NCLT's inherent power under Rule 11 of the NCLT Rules, 2016, to recall an order obtained by fraud.

Final Outcome

The Tribunal dismissed both recall applications (IA-05/2023 and IA-06/2023). It held that the Applicants had failed to substantiate their allegations of fraud. The order dated 19.04.2022 was passed on the merits after hearing both parties, based on the Applicants' failure to prove the existence of a financial debt by not providing a loan agreement, certified bank statements, or any acknowledgment of debt from the Corporate Debtor. The Tribunal affirmed that while it has the inherent power to recall an order under specific, exceptional circumstances (such as fraud, lack of jurisdiction, or lack of notice), this power is not a substitute for a review and must be exercised sparingly. The bench found no grounds for recall in this case, as the original order was based on an evaluation of the evidence presented.

Topics: Insolvency Petition, Recall Application, Fraud Allegation