In a batch of 70 execution applications in various consumer complaints filed before the National Consumer Disputes Redressal Commission against M/s Ansal Hi-Tech Township Limited (AHTTL), a bench of Dr. Inder Jit Singh (Presiding Member) and Justice Sudhir Kumar Jain (Member) lifted the corporate veil between the parent and subsidiary companies, and issued various directions for satisfaction of the decree passed against AHTTL.
The main issues for consideration in the matter were-
• Whether the Supreme Court’s judgment dated 12-01-2026 affected the company’s directors’/key managerial persons’ liability under Section 72 of the Consumer Protection Act, 2019, even in a situation where the Company may be under moratorium.
• Whether the decree holders had made out a case for lifting the corporate veil to make AHTTL’s parent company, Ansal Properties and Infrastructure Limited (APIL), and/or its directors/key managerial persons liable to satisfy the decree against AHTTL, and/or to comply with NCDRC’s subsequent orders.
One of the consumer complaints was disposed of by the NCDRC by an order dated 16-10-2020, whereby it was directed that the order was limited to the allottees of residential plots in ‘Sushant Megapolis’ who did not wish to wait any longer for possession and wanted a refund of the amount paid by them along with appropriate compensation. AHTTL was directed to refund the entire principal amount, together with simple interest at 8% per annum, as compensation. NCDRC also directed AHTTL to pay Rs. 50,000/- as litigation costs to the complainants, and to make the said payment within 3 months. Two other consumer complaints were also disposed of on similar terms.
Since AHTTL did not comply with the orders, various execution applications were filed by different decree holders, out of which 70 were dealt with in the present order.
As per an order dated 06-03-2023, the District Collector was directed to issue recovery certificates under Section 71 of the Consumer Protection Act, requiring the recovery of the outstanding amount from the judgment debtor. By an order dated 06-10-2021, a warrant of attachment under Section 139 of the Delhi Land Reforms Act, 1954, was issued by the Assistant Collector, attaching the movable and immovable properties of the defaulter. Thereafter, the Deputy Director (Tax), New Delhi Municipal Council, informed the SDM, Chanakyapuri, that the flat at Ansal Bhawan stood mutated in the name of APIL.
After the Court was informed that the owner of the said property was APIL, not AHTTL, bailable warrants were issued against the directors for their attendance on the next date. In an order dated 08-11-2024, the NCDRC recorded repeated failures by AHTTL to comply with specific orders and directed that non-bailable warrants be issued. After repeated absence, AHTTL was given a last opportunity on 18-12-2024 to satisfy the decree within two months.
In the hearing on 05-03-2025, it was noted that neither the decree had been satisfied nor an affidavit was submitted regarding the details of the bank accounts. Hence, directions were issued against eight directors/key managerial persons to show cause within six weeks as to why coercive steps should not be taken against them. Similar orders were issued against eight promoters of APIL, and all 16 persons were directed to appear in person at the next hearing.
Thereafter, AHTTL was represented through an advocate, but none of the directors/key managerial persons were represented, and it was stated that APIL had gone into insolvency. Taking note of the Supreme Court’s direction to conclude the execution proceedings within four months, NCDRC took up the matters on priority.
NCDRC said that before fixing the liability in the matter, the applications filed by the directors/key managerial persons regarding their liability must be taken up, considering that the Supreme Court had stated that even in a situation where the company is under moratorium, the directors and promoters of the JD company should be otherwise liable. Fresh summons were issued to the eight directors, and the advocate on record was directed to declare the complete postal address of AHTTL.
By an order dated 28-08-2025, it was observed that the whereabouts of the eight directors were unknown and that the promoters were not the directors/key managerial persons of AHTTL. On 12-11-2025, NCDRC issued bailable arrest warrants against persons who were directed to be present but remained absent, and noted that although an affidavit had been filed on behalf of AHTTL, it was incomplete and noncompliant with earlier orders. Directions were issued that AHTTL was not to create any third-party right or deal with any of its movable or immovable properties in any manner whatsoever till further orders. AHTTL was also directed not to make any withdrawals from its bank accounts till the next date.
During the hearing, it was pointed out that although APIL was under moratorium earlier, as per NCLAT’s order dated 07-01-2026, the moratorium had been restricted to certain projects, and that the project in question was not covered.
NCDRC noted that the Supreme Court, in its judgment dated 12-01-2026, considered whether persons who were arrayed as respondents, but against whom no notice was issued, could be brought within the net of execution on the premise that they were directors/promoters of the JD company, and clarified that this issue was to be decided by the National Commission as per law.
It was stated by NCDRC that if the directors/key managerial persons of a judgment debtor company, having a decree against it, were not parties to the original complaint and/or there were no directions against them, then they cannot be held personally liable for satisfying said decree, and their personal assets cannot be attached. Further, NCDRC held that Section 71 proceedings cannot be initiated against them in view of the Supreme Court’s decision dated 12-01-2026 in Ansal Crown Heights Flat Buyers Association (Regd.) v. M/s Ansal Crown Infrabuild Pvt. Ltd. & Ors. (2024) 5 SCC 745.
However, the NCDRC stated that such directors would remain liable, and penal action under Section 72 of the Consumer Protection Act can be initiated against them for the JD company’s failure to satisfy the decree. It was said that such proceedings can be initiated/continue irrespective of whether the company is under moratorium. This was decided keeping in view the Supreme Court’s decision dated 17-01-2024 in Ansal Crown Heights Flat Buyers Association (supra).
Further, NCDRC held that since AHTTL was not under moratorium, it was liable to satisfy the decree as well as various orders passed from time to time, and that it was liable for proceedings under Section 71, which is why its assets could be attached to satisfy the decree. It was also stated that, since AHTTL was already non-compliant with orders, its directors/key managerial persons were liable to be proceeded against under Section 72 unless they established otherwise.
NCDRC issued an interim direction to AHTTL not to create any third-party rights in respect of any asset, or to dispose of/deal with the same in any manner, till further orders. An order was also passed to freeze all bank accounts of AHTTL till they appear before the NCDRC and show cause as to why the freezing of bank accounts and the interim order of attachment/maintenance should not be made permanent. The Registry was directed to issue fresh summons to the authorized representatives/CEO/managing director of the company, with a copy thereof to be sent to the advocate who had filed the vakalatnama on the company’s behalf. NCDRC also directed the Registry to issue non-bailable arrest warrants against the eight directors/key managerial persons of AHTTL, through the SHOs of the police stations concerned, who had failed to appear before the Commission.
Thereafter, NCDRC held that even if it is held that a parent company is liable, and that the corporate veil between the parent company and the subsidiary company can be lifted, the directors/key managerial persons cannot be personally held liable to satisfy the decree against the JD company. It was said that neither their personal assets can be attached, nor can they be proceeded against under Section 71.
NCDRC stated that if it is established that a subsidiary company is a mere façade to evade liability or defraud consumers, the corporate veil between the parent company and the subsidiary company can be lifted. After perusal of the documents submitted by the decree holders, NCDRC found it clear that AHTTL was formed as a front company to execute the project of the consortium Uttam Steel Associates, of which APIL was a part. The company purchased 680 of 1660 acres of project land and was to acquire the remaining 980 acres as well.
NCDRC concluded that APIL and AHTTL were inextricably connected and had been working in cohesion under the overall control of the Chairman and Whole Time Director of APIL, who was not only the main decision-maker of APIL but also of the consortium and AHTTL. It was held that the corporate structure of the parent and subsidiary companies, being two different legal entities, was being misused to avoid satisfaction of the decrees.
Thus, NCDRC ordered the lifting of the corporate veil and to treat AHTTL and APIL as one economic unit to satisfy the decrees, as well as for compliance with other related orders. APIL and its management’s liability to satisfy the decree was joint and several, along with AHTTL and its management. Since AHTTL was not under moratorium, NCDRC found it liable for action under Sections 71 and 72.
Decree holders were directed to collect and file details of AHTTL and APIL’s assets to enable the Commission to proceed further under the Consumer Protection Act and the Civil Procedure Code, 1908, for attachment of AHTTL’s property to satisfy the decree. The Managing Director/Chief Executive Officer of both AHTTL and APIL were directed to file an affidavit within four weeks regarding all its assets. NCDRC also stated that the registry may write to banks to verify AHTTL’s bank accounts and directed the banks to attach such accounts immediately, along with six months’ statements, and not to allow any further transactions from the said accounts.
Regarding the immovable properties, the Registry was to have them verified by the concerned authorities, and the authorities were directed to attach them immediately if they were in the name of AHTTL. It was clarified that the directors/key managerial persons of AHTTL were not liable for action under Section 71, but were liable under Section 72. Further, apart from the issuance of non-bailable warrants against the eight directors/key managerial persons of AHTTL, a bailable arrest warrant was to be issued against AHTTL’s authorized representative with directions to release him on a personal bond of Rs. 5 lakhs for appearance on the next date.
Further, APIL was directed to file the details of all directors/key managerial persons of AHTTL with the Registry within two weeks, along with those of the Managing Director/CEO and the authorized representative. NCDRC directed notice to the Chairman and Company Secretary of APIL to appear before the Commission and to show cause why action under Section 71 should not be taken against APIL. Further, only the current directors/key managerial persons of APIL were held to be liable under Section 72. However, one month’s time was given to APIL and AHTTL to satisfy the decree, failing which, proceedings under Section 72 would follow.
Notice was also issued to the Managing Director/CEO of APIL to show cause why Section 72 proceedings shall not be initiated against him, and he was directed to file an affidavit within four weeks. NCDRC directed APIL to maintain the status quo regarding its assets and not to create any third-party rights or deal with any of its assets till further orders.
The next hearing for the cases will be held on 29-04-2026.
Appearances:
For Complainant – Ms. Mantika Haryani, Mr. Bhanu Mishra, Mr. Saurabh Jain, Mr. Pranjal Mishra, Ms. Ishita Singh, Mr. Aditya Parolia, Ms. Sumbul Ismail, Mr. Azhar Alam, Mr. Pramit Saxena, Mr. Dhiraj Singh, Mr. Madhurendra Kumar, Ms. Nehmat Sethi, Mr. Chetan Sharma, Mr. Sunil Mund, Mr. Haneef Mohamed, Ms. Rashmi Manshani, Mr. Raghav Gupta, Mr. Rishabh Kumar Jain
For Respondents – Dr. Shashi Kiran (Sr. Adv), Mr. Malak Bhat, Mr. Hitaish Chauhan, Mr. Saahil Bahety, Mr. Bharat Arora, Mr. Amitesh Gaurav, Mr. Sanjeev Mahajan, Mr. Arjun Sain, Mr. Nikhil Kumar Sharma, Ms. Anju Sharma, Ms. Deepshika Malhotra
