NCLAT Clears Insolvency Case Against Mahagun After ₹256 Crore Settlement
The appellate tribunal has allowed withdrawal of insolvency proceedings against Mahagun after a settlement with IDBI Trusteeship, bringing relief to homebuyers and enabling the developer to refocus on project delivery.
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Insolvency plea over ₹256.48 crore NCD default withdrawn
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Settlement agreement dated February 12, 2026 accepted by tribunal
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Mahagun Manorialle project in Noida gets major relief
National Company Law Appellate Tribunal (NCLAT) has permitted the withdrawal of insolvency proceedings against Mahagun (India) Pvt Ltd after the company reached a settlement with its financial creditor, IDBI Trusteeship Services Limited.
The case stemmed from an alleged default of ₹256.48 crore related to non-convertible debentures (NCDs) issued for the developer’s premium housing project, Mahagun Manorialle, located in Noida. The insolvency petition had originally been filed under Section 7 of the Insolvency and Bankruptcy Code, 2016.
Background of the Case
The matter was first admitted into the Corporate Insolvency Resolution Process (CIRP) by the National Company Law Tribunal (NCLT) on August 5, 2025. However, Mahagun challenged the admission order before the appellate tribunal.
On November 6, 2025, NCLAT set aside the initial admission and sent the matter back for fresh consideration. During the course of hearings, both parties entered into a formal settlement agreement dated February 12, 2026.
Following this, IDBI Trusteeship moved an application seeking withdrawal of the insolvency petition. A two-member bench of NCLAT accepted the settlement on record and dismissed the case as withdrawn on February 17, 2026. All pending applications were disposed of accordingly.
However, the financial creditor has retained the liberty to revive the insolvency petition if the developer fails to comply with the terms of the settlement.
What This Means for Homebuyers
The withdrawal of insolvency proceedings brings much-needed clarity and relief, particularly for buyers of Mahagun Manorialle, an ultra-luxury residential project located in Sector 128, Wish Town, along the Noida–Greater Noida Expressway.
In a statement, the company reiterated its commitment to delivering possession of apartments while maintaining quality standards. It described the resolution as a crucial step that would allow it to focus on timely execution, restoring customer confidence, and creating long-term value.
The decision highlights how settlements under the Insolvency and Bankruptcy Code framework can provide structured resolutions without prolonged litigation. For the NCR property market, the closure of the insolvency case against Mahagun signals stability and reduces uncertainty around one of its prominent luxury projects.
With the matter now closed, the focus shifts to project completion and adherence to settlement terms — developments that will be closely watched by buyers and industry stakeholders alike.
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