NCLAT Directs Withdrawal of Insolvency Proceedings Against Mahagun After Settlement with IDBI Trusteeship

NCLAT Closes Insolvency Proceedings Against Mahagun

A two-member bench of the National Company Law Appellate Tribunal (NCLAT) formally recorded a settlement between Mahagun (India) and IDBI Trusteeship dated February 12, 2026, and dismissed the insolvency petition on February 17, 2026. The approval follows an application by the financial creditor to withdraw insolvency proceedings against the realty firm.

The Default and Insolvency Process

Mahagun was placed under the Corporate Insolvency Resolution Process by the NCLT following a section 7 application filed by IDBI Trusteeship, which cited a default of Rs 256.48 crore on non-convertible debentures issued for the Noida-based Mahagun Manorialle project. IDBI Trusteeship sought liberty to restore or revive its insolvency petition in the event the company fails to adhere to the settlement terms.

Legal Outcome and Project Relief

NCLAT dismissed the insolvency petition as withdrawn, effectively halting what had become a significant legal impediment to the stalled Manorialle development. This settlement follows an earlier NCLAT decision in November 2025, when the tribunal set aside another insolvency proceeding and directed the NCLT to reconsider based on a fresh project status report.

Mahagun's Footprint in Noida

Mahagun is known for developing iconic buildings in Ghaziabad and Noida and has delivered around 15.76 million sq ft of residential and commercial spaces. Completed Noida projects include Mahagun Manor in Sector 50 (handed over 2005–2006), Mahagun Maestro and Morpheus in Sector 50 (2007–2008), and Mahagun Maple in Sector 50 (2011–2012). The group currently executes approximately 15,000 units across approximately 18.50 million sq. ft.

Mahagun Manorialle features six towers offering 386 housing units, and is situated in Sector 128, Noida. The project is registered under RERA with registration number UPRERAPRJ2051.