SREI Finance Withdraws NCLAT Appeal Over Nirmal Lifestyle’s Resolution Plan After Property Clarification

SREI Equipment Finance Ltd has withdrawn its appeal before the National Company Law Appellate Tribunal (NCLAT) challenging the revival plan for debt-laden realty firm Nirmal Lifestyle (Mulund) Pvt Ltd. The decision came after the successful bidder clarified that a disputed, mortgaged property was never part of the approved resolution.

In April, the Mumbai bench of the National Company Law Tribunal (NCLT) approved the acquisition of Nirmal Lifestyle by Pune-based developer Mantra Properties and Developers Pvt Ltd. While Nirmal Lifestyle has admitted liabilities totaling ₹1,491 crore, Mantra Properties’ approved resolution plan proposed ₹215 crore to revive the company.

The Property Dispute

Following the NCLT’s approval, SREI Equipment Finance approached the appellate tribunal. Represented by senior counsel Gopal Jain and Ativ Patel of AVP Partners, SREI argued that the resolution plan wrongfully included a property exclusively mortgaged to them.

• The Claim: SREI contended that the asset was charged in its favor via a mortgage deed executed on September 18, 2019, securing two separate loans of ₹84.2 crore each.

• The Argument: SREI maintained that the property should not have been bundled into the resolution plan without giving them a proper hearing.

However, Akshay Petkar, counsel appearing for Mantra Properties, cleared the air by confirming that the land in question—identified as Nirmal Olympia II—fell entirely outside the scope of the approved resolution plan. Following this clarification, an NCLAT division bench comprising Justice Yogesh Khanna (Judicial Member) and Naresh Salecha (Technical Member) allowed SREI to withdraw its application and officially disposed of the appeal.

Background of the Insolvency

Nirmal Lifestyle was admitted into the Corporate Insolvency Resolution Process (CIRP) in July 2023 following a petition filed by Beacon Trusteeship Ltd.

The company’s Committee of Creditors (CoC) is comprised of just two secured financial creditors:

The Resolution Professional (RP) originally received three bids for the company, including the winning proposal from Mantra Properties, a bid from Vasavi Realty Pvt Ltd, and a joint consortium bid by Sardarmal Prithviraj Constructions Private Limited and Dharmesh Sardarmal Jain (the ex-promoter of Nirmal Lifestyle).