Allottee status in insolvency upheld where unit purchase payments showed financial debt and promoter-based objections were rejected.

Unit purchasers were treated as allottees and financial creditors in a class where agreements and payment records showed debt arising from acquisition of units, bringing the transactions within Section 5(8)(f) of the Insolvency and Bankruptcy Code and supporting admission of claims under Section 3(6). The insolvency framework was held to apply only the RERA-based definitions expressly incorporated in that provision, so the real estate statute's broader promoter definition could not be used to defeat allottee status; the substance of the transaction controlled. Claims were also not liable to rejection merely because the claimants were struck-off companies, were said to be speculative investors, or their claims did not appear in the corporate debtor's financial statements.

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Issues: (i) Whether the respondents' claims could be admitted and their membership in the committee of creditors sustained on the basis that they were allottees and financial creditors in a class under the insolvency framework. (ii) Whether the appellants could invoke the real estate regulatory definition of promoter to exclude the respondents from allottee status. (iii) Whether the respondents' claims were liable to be rejected because they were struck off companies, speculative investors, or because their claims did not appear in the corporate debtor's financial statements.

Issue (i): Whether the respondents' claims could be admitted and their membership in the committee of creditors sustained on the basis that they were allottees and financial creditors in a class under the insolvency framework.

Analysis: The agreements and payment documents were held to be sufficient to establish the existence of debt due to creditors in a class. The making of payments for acquisition of units was treated as having the character of commercial borrowing, bringing the unit purchasers within Section 5(8)(f) of the Insolvency and Bankruptcy Code, 2016 and enabling them to lodge claims under Section 3(6) of the Insolvency and Bankruptcy Code, 2016. The admission of their claims by the resolution professional was therefore found to be justified.

Conclusion: The respondents were rightly treated as allottees and financial creditors in a class, and their inclusion in the committee of creditors was upheld.

Issue (ii): Whether the appellants could invoke the real estate regulatory definition of promoter to exclude the respondents from allottee status.

Analysis: The insolvency framework was held to incorporate only the limited RERA-based definitions expressly adopted in the explanation to Section 5(8)(f) of the Insolvency and Bankruptcy Code, 2016. It was held that the definition of promoter from the real estate statute could not be imported to displace the statutory treatment of an allottee under the insolvency law. The substance of the transaction, and not the mere recital or nomenclature in the agreements, governed the issue.

Conclusion: The promoter-based objection was rejected and the respondents' allottee status was sustained.

Issue (iii): Whether the respondents' claims were liable to be rejected because they were struck off companies, speculative investors, or because their claims did not appear in the corporate debtor's financial statements.

Analysis: It was held that a struck-off company is not barred from asserting claims in insolvency proceedings, and reliance on Sections 248 and 250 of the Companies Act, 2013 did not defeat the respondents' claims. The plea of speculative investment was also rejected because the law does not deny claim participation to an allottee merely because the investment may be commercial or multiple units were booked. Non-reflection of the claims in the balance sheet was found not to be a conclusive ground for rejection in view of Regulation 8A of the Insolvency Resolution Process Regulations, 2016.

Conclusion: The objections based on struck-off status, speculative investment, and balance-sheet mismatch were rejected.

Final Conclusion: The appeal failed to establish any legal infirmity in the impugned order, and the exclusion of the respondents from the committee of creditors was not warranted.

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