The National Company Law Appellate Tribunal (NCLAT) has upheld the order of the National Company Law Tribunal (NCLT) to initiate the Corporate Insolvency Resolution Process (CIRP) against Parsvnath Developers Limited . The appellate tribunal dismissed the appeal filed by Sanjeev Kumar Jain, a suspended director of the company, challenging the admission of the insolvency petition. The order, dated May 29, 2026, affirms the NCLT's decision dated April 30, 2026, which admitted the petition under Section 7 of the Insolvency and Bankruptcy Code, 2016.

The dispute arose from a default claimed by Asset Reconstruction Company (India) Ltd (ARCIL), which had acquired the debt from original lender Sammaan Capital Limited. The financial creditor alleged a total default of ₹942,26,92,456 under the loan agreement. While Parsvnath Developers Limited argued that a settlement had been reached and payments were being made, the NCLAT found that the debt and default were sufficiently proven on record.

Background of the Default

Sammaan Capital Limited had sanctioned various loan facilities to Parsvnath Developers Limited, with the first facility of ₹72 crore sanctioned on March 26, 2018. Following the assignment of debt to ARCIL on September 30, 2024, the corporate debtor proposed a repayment schedule. However, the financial creditor informed the company in July 2025 that it would not proceed with the agreed repayment schedule and subsequently revived the Section 7 application before the NCLT.

The NCLT order noted that Parsvnath Developers Limited had acknowledged an outstanding amount. The adjudicating authority observed that the corporate debtor had admitted that the group of companies was still required to pay an amount of ₹489.32 crore. The tribunal relied on the Supreme Court judgment in B. Prashanth Hegde vs. State Bank of India & Anr., ruling that counterclaims could be considered only at the stage of filing proof of claims during the resolution process.

Proceedings and Tribunal Observations

The NCLAT noted that the adjudicating authority had deferred the pronouncement of the order multiple times at the request of the corporate debtor to allow for settlement talks. Despite these opportunities, no final settlement was reached between the parties. The appellate tribunal observed that the corporate debtor's efforts to settle were ample proof of the existence of debt and default.

The tribunal also upheld the CIRP admission against Noida Marketing Private Limited, which stood as the corporate guarantor for the loan facilities extended to Parsvnath Developers Limited. The NCLAT concluded that since the debt and default of the principal borrower were established, and recall notices had been issued to the guarantor, there were no grounds to interfere with the NCLT's order dated April 24, 2026, regarding the corporate guarantor.

Parsvnath Developers Limited has delayed the submission of its standalone and consolidated financial results for the quarter and year ended March 31, 2026, due to unavoidable circumstances. The real estate developer, currently undergoing the Corporate Insolvency Resolution Process, cited operational challenges for the deferment, which impacts the scheduled deadline of May 28, 2026.

The company addressed the communication to the National Stock Exchange of India Limited and BSE Limited, referencing SEBI Circular CIR/CFD/CMD-1/142/2018 dated November 19, 2018, and Regulation 33 of the SEBI (LODR) Regulations, 2015. The disclosure confirms that the management is endeavoring to ensure compliance with the Listing Regulations despite the existing constraints.

The filing was signed by Atul Kumar Gupta, Company Secretary and Compliance Officer of Parsvnath Developers Limited. The company requested the exchanges to acknowledge the receipt of this communication regarding the deferment of its financial results.