NCLT Approves INR 184 Crore Resolution Plan for Satra Properties
The National Company Law Tribunal (NCLT) in Mumbai has sanctioned the acquisition of bankrupt Satra Properties by a consortium of realty firms.
NcltSatra PropertiesMj Shah EnterprisesCentrio LifespacesResolution PlanReal Estate MumbaiAug 13, 2024
The tribunal has also dismissed an application from the former promoter, Praful Satra, who alleged that the company's properties were undervalued by the resolution professional (RP).
Satra Properties faced claims amounting to approximately INR 719 crore. Praful Satra, represented by Advocate Gayatri Mohite, challenged the resolution plan, claiming illegalities and significant undervaluation of the company's assets. Mohite highlighted concerns over the valuation of prime properties in Mumbai's Kalina area and a prospective hotel project in Jodhpur, suggesting that these were merely assessed at book value without considering their current market value and future potential.
Praful Satra argued that the Kalina properties, which have complicated ownership structures and are occupied by multiple tenants, were not fully valued. He also claimed that the valuation of the Jodhpur property overlooked a substantial benefit of INR 50 crore in terms of hotel floor space index.
In defense, counsel Pulkit Sharma, representing the RP, asserted that the valuation was carried out by reputable firms and that all stakeholders, including the committee of creditors (CoC), were well-informed and engaged in the valuation process. Sharma explained that discrepancies in the valuation stemmed from incomplete data and the presence of encroachments. For instance, the Kalina property had about 55 tenants occupying over 61,000 square feet, complicating its valuation.
A division bench comprising Justice VG Bisht and technical member Prabhat Kumar, in their late July order, concluded that the objections raised by Praful Satra did not warrant the dismissal of the resolution plan. They noted that the resolution plan had undergone extensive deliberations and received majority approval from the CoC. The bench also acknowledged the RP's consistent efforts to update and inform all parties involved, addressing valuation omissions and updating the information memorandum as necessary.
The National Company Law Tribunal (NCLT) in Mumbai has approved the acquisition of Satra Properties (India) by MJ Shah Enterprises, MJ Shah Realtors LP, and Centrio Lifespaces under a resolution plan valued at INR 184 crore. This decision comes despite challenges from former promoter Praful Satra, who claimed the company's assets were undervalued. The tribunal dismissed Satra's objections, noting that the valuation process involved reputable firms and thorough stakeholder engagement. The resolution plan, supported by the committee of creditors, was deemed comprehensive and properly deliberated, with the tribunal recognising the resolution professional's efforts to address valuation issues.
Frequently Asked Questions
What is the value of the resolution plan approved by NCLT for Satra Properties?
The resolution plan is valued at INR 184 crore.
Who is the former promoter of Satra Properties who challenged the resolution plan?
Praful Satra
What is the name of the consortium that will acquire Satra Properties?
MJ Shah Enterprises, MJ Shah Realtors LP, and Centrio Lifespaces
What is the total amount of claims faced by Satra Properties?
Approximately INR 719 crore
What is the name of the tribunal that approved the resolution plan?
National Company Law Tribunal (NCLT) in Mumbai
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