Pranav B Prem

The National Company Law Tribunal (NCLT), New Delhi Bench, has directed the suspended directors of Opulent Infradevelopers Pvt. Ltd. to personally contribute ₹10.46 crore to the assets of the company after holding that they conducted its business “with intent to defraud creditors” by diverting funds through unauthorised donations, interest-free advances, manipulation of accounts and booking fictitious expenses. The order was issued by Judicial Member Manni Sankariah Shanmuga Sundaram and Technical Member Atul Chaturvedi on an application filed by Resolution Professional Devendra Umrao under Section 66 of the Insolvency and Bankruptcy Code (IBC).

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Background

Opulent Infradevelopers entered corporate insolvency on July 12, 2022, on a petition filed by financial creditor Genesis Comtrade Pvt. Ltd. After taking charge, the Resolution Professional examined business transactions undertaken in the two years preceding insolvency and found multiple irregularities that suggested diversion of funds. With the approval of the Committee of Creditors (CoC), a transaction audit was conducted for the period July 12, 2020 to July 12, 2022, during which four sets of financial dealings were identified as problematic.

The audit found ₹3.10 crore had been donated between January and June 2021 to three trusts while the company was already in severe financial distress and had defaulted on creditor payments. It also noted that loans and advances totaling approximately ₹12.34 crore were extended without charging interest, causing a loss of ₹1.33 crore in legitimate revenue. Additionally, adjustment entries amounting to ₹1.06 crore were passed shortly before insolvency commencement without substantiation, and ₹4.96 crore in fictitious or non-business expenses were booked without supporting documentation.

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Tribunal’s Observations

The Tribunal rejected the suspended directors’ justification that the donations were bona fide and supported by board approvals. It held that once a company is financially distressed, directors must prioritise creditor interests, and therefore such large donations outside the business objects of the company were clearly intended to divert funds away from the estate of creditors.

On interest-free loans, the Tribunal observed that extending substantial sums without charging interest or obtaining creditor approval during a liquidity crunch reflected gross negligence and mala fide intent, depriving the company of legitimate income.  With respect to adjustment entries made just prior to insolvency commencement, the Tribunal concluded that these were intentionally executed to manipulate the books of accounts. It particularly noted that the directors admitted that balances were swept to “avoid liability and limitation,” which demonstrated deliberate falsification of financial statements.

Regarding the sum of ₹4.96 crore booked as expenses without proper justification, the Tribunal found that the lack of supporting documents and the nature of the expenditures indicated that they were carried out only to siphon funds rather than were genuine business expenses.

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Final Order

After concluding that the suspended directors were knowingly parties to fraudulent and wrongful trading, the Tribunal ordered Amit Kumar Dubey and Surendra Singh Pilkhwal to jointly and severally contribute ₹10,46,58,571.95 to the assets of the Corporate Debtor. This total amount corresponds to ₹3.10 crore spent on unauthorised donations, ₹1.33 crore lost due to failure to charge interest on loans, ₹1.06 crore involved in adjustment-entry falsification, and ₹4.96 crore linked with false or non-business expenditures. The contribution must be paid within 15 days from November 4, 2025, the date of the judgment. The Tribunal further directed the Resolution Professional to take all steps necessary to recover the amount from the suspended directors.

Appearance

For Applicant- RP: Advocates Gaurav Mitra and Abhishek Parmar for the Resolution Professional.

For Respondents: Advocates Jeetender Gupta, Ashish Mishra and Bharat Rawat for Suspended Director.

Cause Title: Devendra Umrao v. Amit Kumar Dubey & Ors. in Genesis Comtrade Pvt. Ltd. v. Opulent Infradevelopers Pvt. Ltd.

Case No: IA No. 2948 of 2024 in CP No. 304(ND) of 2022

Coram: Judicial Member Manni Sankariah Shanmuga Sundaram, Technical Member Atul Chaturvedi