The Calcutta bench of the National Company Law Tribunal (NCLT) has approved a resolution plan submitted by homebuyers for the stalled Avani Grand project on EM Bypass in a landmark judgment that throws a lifeline to buyers left stranded by errant developers.

The decision will pave the way for the completion of a G+15 tower and help realise the dreams of more than 70 buyers who had collectively invested nearly ₹200 crore in the project but saw little progress for years.

The project will be executed strictly on a not-for-profit basis and monitored by an oversight committee comprising a resolution professional, representatives of homebuyers and creditors and the successful resolution applicant.

The project is likely to generate ₹331 crore in revenues against a development cost of ₹238 crore, as some units will be sold at current market rates. However, existing buyers will make the balance payment at the rate specified in their agreements.

Given that the land was initially leased for 99 years to DLF Hilton Hotels Ltd in 2006 for a commercial venture (hotel), the buyers will get serviced apartments, as is the case with a few other real estate projects near Science City.

“Never in our wildest dreams did we imagine that we would get stuck in a project that promised handover in four years. It has been a long wait,” said Sourabh Goel from Bhowanipur.

He, however, fears that their tribulation might not be over as the NCLT order could be challenged in higher forums.

Goel had booked a 3,600-square-foot apartment in 2012 and paid ₹3.5 crore to builder Avani, which is over 80 per cent of the transaction cost. He was not alone.

After years of delay in the handover, the buyers approached the NCLT to retrieve their money. In the absence of a resolution plan, Avani was considered for liquidation. However, the homebuyers later submitted a proposal to develop the project themselves, considering the evolving landscape of the country’s decade-long bankruptcy legislation.

The Kolkata Municipal Corporation (KMC), which had leased the land, was not part of the resolution plan.

Ratnanko Banerji, Joy Saha, Rishav Banerjee and Sanjay Basu were the lead counsel for Adone, homebuyers, the resolution professional and the committee of creditors, respectively.

Banerjee explained: “The NCLT judgment becomes a precedent on project-wise insolvency, which is also now the intention of the legislature, as the 2026 IBC (Insolvency and Bankruptcy Code) Amendment also codifies project-wise CIRP (Corporate Insolvency Resolution Process).”

“Insolvency can now be initiated for a single failing project only, without triggering CIRP for the entire company,” Banerjee added.

Chequered past

The KMC had leased the 5.59-acre land in question to DLF Hilton for ₹154 crore in 2006, setting a new benchmark in the city’s real estate market.

However, the hotel project dream was derailed by the global financial crisis in 2008, and the DLF eventually sold its subsidiary Adone Hotels and Hospitality Ltd — which held the land parcel — to a consortium in 2012.

The consortium of buyers included Avani, which developed the Avani Riverside Mall in Howrah. Later, Avani and Adone signed a joint development agreement for the Avani Grand project.

In 2013, the KMC approved a plan to build a hotel on 51 per cent of the land, while earmarking 49 per cent for serviced apartments. Not only has no meaningful work happened on the ground since then, but the buyers have also accused the developer of attempting to rob them of their rights.

According to the plan approved by the tribunal, the money for developing the project will come from three sources — balance payments by existing homebuyers, proceeds from the sale of 60-odd apartments and a bridge loan.

The surplus generated from the venture will go to the lessee, Adone Hotels(formerly DLF Hilton), and creditors such as the State Bank of India.