NCLT admits Kotak Mahindra Bank insolvency plea against Unity Realty and Developers
The National Company Law Tribunal has admitted Kotak Mahindra Bank's insolvency petition against Unity Realty and Developers over a claimed default of ₹68.49 crore. The Mumbai-based real estate firm acted as corporate guarantor for loans taken by Unity Infraprojects.
The National Company Law Tribunal (NCLT) has admitted Kotak Mahindra Bank's insolvency petition against Unity Realty and Developers, a Mumbai-based real estate company, over a claimed default of ₹68.49 crore. The Mumbai bench of the tribunal, in an order pronounced on 22 September, admitted the petition filed under Section 7 of the Insolvency and Bankruptcy Code (IBC) on 25 February, paving the way for initiation of the corporate insolvency resolution process (CIRP).
The financial creditor had claimed the amount in default as of 31 August 2025, with 23 September 2023 stated as the date of default. Unity Realty and Developers is a corporate guarantor for financial facilities availed by Unity Infraprojects, whose account had been classified as a non-performing asset on 30 June 2015.
The dispute relates to financial facilities originally sanctioned by ING Vysya Bank in 2008. Following financial difficulties faced by the principal borrower, a corporate debt restructuring package was approved in 2014, and restructured facilities aggregating to ₹31.78 crore were sanctioned in February 2015. Unity Realty and Developers had executed a corporate guarantee in relation to these facilities.
The guarantee was invoked by the bank in October 2019. The Debt Recovery Tribunal (DRT), Delhi, subsequently directed the defendants, including Unity Realty and Developers, to jointly and severally pay ₹39.45 crore, along with interest at 11 per cent per annum. A recovery certificate issued in August 2023 quantified the liability at ₹55.94 crore, besides further interest and costs.
The tribunal rejected objections from Unity Realty, noting that the DRT's judgment and recovery certificate had not been challenged, stayed, modified or set aside. It held that the DRT judgment and recovery certificate provided a fresh cause of action and that the insolvency application filed in February 2026 was within the limitation period.
The NCLT also held that Unity Realty and Developers' liability as a corporate guarantor could be proceeded against under Section 7 of the IBC. It said the financial creditor had established the existence of financial debt and default and that the petition satisfied the requirements of the IBC.
