MUMBAI: Homebuyers in Lavasa, a hill town developed by Lavasa Corp, have submitted a new appeal requesting intervention from the appellate tribunal. They have cited significant issues within the resolution plan.
In their appeal, the homebuyers have raised concerns about discriminatory treatment, arbitrary financial burdens, a lack of transparency in the insolvency process, and possible changes to key elements of the approved plan by the Welspun Group-Ashdan Properties consortium.
In a detailed 99-page appeal, they requested a stay on the NCLT’s order regarding their case and urged the appellate tribunal to instruct the NCLT to review pending applications from homebuyers and other stakeholders prior to any approval of the resolution plan.
Additionally, they have sought monetary compensation, asking for a refund of their total investment with an interest rate of 12% per annum from the date they signed their agreements.
In February, RealtyDailyNews reported that Lavasa Corp’s creditors voted 92.21% in favor of the Welspun-Ashdan consortium to take control of India’s first privately owned hilltown. Homebuyers disagreed with this decision during the committee of creditors (CoC) meeting where the resolution plan was approved.
This month, the Mumbai bench of the NCLT quickly reserved the matter for orders on April 28 without hearing the homebuyers, concluding arguments in just about ten minutes.
The appeal argues, “This order was issued in serious violation of natural justice principles, denying the appellants their right to be heard. The NCLT acknowledged that homebuyers had voted against the resolution plan in the CoC meeting.” They also claim previous concerns raised about the insolvency process remain unaddressed and pending in court.
Lavasa was promoted as India’s first privately built city at the turn of the century, catering to affluent residents of Mumbai and Pune seeking refuge from urban chaos. Designed after the Italian village of Portofino, it included plans for a golf course and a football academy but eventually faced bankruptcy and was admitted to insolvency in 2018.
Darwin Platform Infrastructure Ltd (DPIL) proposed a plan in December 2021 involving a total payout of ₹1,814 crore over eight years, incurring a 79% haircut for financial creditors. However, they failed to implement the resolution plan by not paying the upfront amount of ₹100 crore, leading to a revival of insolvency proceedings in September 2024.
Union Bank of India is the lead lender, accounting for 12% of total dues, which amount to ₹6,642 crore. Phoenix ARC is the second-largest creditor, holding almost 11% of the total debt, while another ARC, Arcil, owns more than 10% of it.
