IP suspended for ‘lack of diligence’ as buyers wait for flats in Noida project 16 years on

Ghaziabad: The Insolvency and Bankruptcy Board of India (IBBI) has suspended the registration of insolvency professional (IP) Sanjay Gupta for clearing inflated claims and levying unauthorised charges, burdening 1,800 homebuyers of a Noida residential project.IBBI chairperson Ravi Mital, on June 16, suspended Gupta’s registration for two years after the board’s disciplinary committee found he had contravened provisions of the Insolvency and Bankruptcy Code and its regulations. The board acted after receiving multiple complaints regarding his conduct in the assignment and issued a show-cause notice.Aranya Society, with 1,800 units in Sector 119, was launched by Unnati Fortune Holdings Ltd in 2011.

In 2019, insolvency proceedings were filed against the builder, and Gupta was appointed Interim Resolution Professional (IRP) on March 27, 2019, and later confirmed as RP.The disciplinary committee flagged two specific violations. The first concerned Gupta’s failure to verify and revise an admitted claim by corporate creditor Nupur Finvest, which had sought Rs 19.6 crore on Feb 20, 2020. Nupur Finvest subsequently realised an aggregate Rs 6.2 crore through resolution plans approved in two separate Corporate Insolvency Resolution Processes (CIRP) — Rs 3.2 crore and Rs 3 crore, respectively.

Despite this recovery, Gupta continued to treat the claim as Rs 19.6 crore without adjustment, the order said.“By admitting the claim in full without adjusting the amounts already realised by the creditor, Sanjay Gupta allowed the claim to remain inflated,” the board said, adding that his conduct demonstrated “lack of reasonable care and diligence in discharge of his duties”.The second violation related to the levy and enhancement of transfer charges and cancellation of residential units during the CIRP without approval from the Committee of Creditors (CoC), resulting in a financial burden of over Rs 3.5 crore on homebuyers.

The board held that such a decision, given its scale, could not be treated as routine and ought to have been placed before the CoC.Homebuyers said the order affects thousands who have been awaiting resolution and possession for years. “At the onset, Sanjay Gupta, as an insolvency professional, was required to complete the proceedings in 180 days, for which he demanded Rs 12.5 lakh per month. The rules allow a 90-day extension, which was availed in this case, but resolution is nowhere in sight,” said Kunal Gupta, a homebuyer and one of the complainants.“It was after our complaint that we realised the rot ran deep, with Sanjay Gupta in the middle of these financial wrongdoings. What could be a more plausible explanation for all this other than that our IP, who was entrusted to bail us out, was minting money from the plight of over 1,800 poor homebuyers?” he added.Sanjay Gupta told TOI he had submitted a point-by-point explanation of the allegations. “I think my reply was not interpreted by the disciplinary committee in the way it should have been. I am contemplating my next course of action,” he said.In Ghaziabad and Gautam Budh Nagar, 86 projects have been declared insolvent, with proceedings underway for as long as eight years in some cases.