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2021 (6) TMI 652 - AT - Insolvency and BankruptcySubstitution of Legal Heirs in the appeal, on the death of original appellant - defaults were committed by the Corporate Debtor in repayment of financial facilities availed from the Applicant Bank - HELD THAT - Considering the defaults committed by the Corporate Debtor in its repayment obligation, the applicant bank invoked the securities provided by the Corporate Debtor and its promoters. After invocation of securities, the Applicant Bank took actions under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and took symbolic possession of the Land in question along with Bank of Baroda on 22.09.2015 in accordance with Section 13(4) of the Act read with Rule 9 of the Security Interest (Enforcement) Rules, 2002. After this verification, it became absolutely clear to the Applicant Bank that the Corporate Debtor has no right over the said Land anymore and hence the said Land does not fall under the category of assets of the Corporate Debtor . Accordingly, the Applicant Bank requested the RP to hand over the Land to the Applicant Bank and not to the Corporate Debtor - the Applicant has decided to file the application seeking clarification of the Judgment dated 03.03.2021 in respect to the Land in question. Hence, the Applicant is filing the present application. There is urgency in the matter, as the RP is due to handover the Land to Corporate Debtor on 24.04.2021, who have no right and title over the property. The land does not form part of the Assets of the Corporate Debtor, and hence it is not liable to be returned to the Corporate debtor - Appeal not maintainable and is dismissed.
Issues:
1. Clarification on property not covered by the judgment. 2. Direction for possession of property to the Applicant Bank. 3. Maintenance of status quo on the property. 4. Ad-interim orders. 5. Applicability of the judgment on the property in question. 6. Maintainability of the application filed by the State Bank of India. Analysis: 1. Clarification on Property Not Covered by Judgment: The State Bank of India (SBI) filed an application seeking clarification on a property not covered by the judgment dated 03.03.2021. The property in question was not considered as part of the assets of the Corporate Debtor. SBI requested the Appellate Tribunal to direct the Resolution Professional (RP) to hand over possession of the property to the bank, emphasizing that the land was mortgaged to SBI and symbolic possession was taken in 2015 under the SARFAESI Act. 2. Direction for Possession of Property to the Applicant Bank: SBI argued that the Corporate Debtor had no right over the land, as verified by the RP, and thus, the property should be handed over to SBI and not to the Corporate Debtor. SBI highlighted that the lease deed for the land had expired in 2015, and there was no fresh lease deed between the Corporate Debtor and the landowners. SBI urged the Tribunal to ensure that the RP hands over the land to the bank instead of the Corporate Debtor. 3. Maintenance of Status Quo on the Property: SBI requested the Appellate Tribunal to maintain the status quo regarding the property until the disposal of the application. The urgency was stressed as the RP was scheduled to hand over the land to the Corporate Debtor, who had no rightful claim over it, on 24.04.2021. 4. Ad-Interim Orders: In its application, SBI also sought ad-interim orders to prevent the RP from handing over the land to the Corporate Debtor until a final decision was made by the Tribunal. The bank emphasized the need for immediate intervention to protect its interests in the property. 5. Applicability of the Judgment on the Property in Question: The Tribunal noted that SBI was not a party in the original proceedings before the NCLT and was not involved in the appeal process. The application filed by SBI introduced new facts that were not part of the previous proceedings. The Tribunal concluded that the application seeking clarification was not maintainable under Rule 11, as SBI was not a direct party in the case. 6. Maintainability of the Application Filed by the State Bank of India: The Tribunal found that SBI did not intervene in the earlier proceedings and only filed the application at a later stage, introducing new facts. As SBI was not a party in the original case, the Tribunal deemed the application under Rule 11 as not maintainable and dismissed it on those grounds. In summary, the Appellate Tribunal dismissed the application filed by the State Bank of India seeking clarification on the property not covered by the judgment, directing possession to the bank, maintenance of status quo, and ad-interim orders, citing lack of direct involvement in the original proceedings.
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