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TMI Blog2019 (1) TMI 83X X X X Extracts X X X X X X X X Extracts X X X X ..... of taking over the control and custody of any asset over which the Corporate Debtor has Ownership right as recorded in the Balance Sheet of the Corporate Debtor. The action of the IRP demanding possession over the property is justifiable considering the said specific provision of the Insolvency Code. The Ownership is a deemed Ownership and not the actual Ownership and in that capacity the Bank/ Financial Institution can exercise their right as if the Owner of the asset but not the actual Owner. The connotation used, ‘as if’, is highly significant giving an indication that the Ownership is a deemed Ownership. The outcome of this discussion is that the IRP is duty bound to invoke the jurisdiction prescribed u/s.18 to perform duty of takin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mr. Mustafa Kachwala, Advocate And Mr. Mahima Singh, Advocate, i/b. Kachwala Misar Co. - for Resolution Professional ORDER 1. An Order had been passed u/s.7 of the I B Code on 06.02.2018 admitting the Petition of State Bank of India, a Financial Creditor against M/s. Calyx Chemicals Pharmaceuticals, a Corporate Debtor and pursuant to the said Order Moratorium commenced. 2. Present IA is submitted by Dena Bank, Applicant seeking an Interim Order to restrain IRP from demanding the custody of the Property, for ready reference, described below:- DESCRIPTION OF THE PROPERTIES MORTGAGED Address of the Property/Security 1. Gala No 2 on the Ground Flor of the Marwah's Compl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al possession was taken over on 13.09.2017, an undisputed fact. 5. Ld. Representative has pleaded that the Resolution Professional is putting pressure to hand over the physical possession back to him, although the Corporate Debtor on whose behalf the Resolution Professional is commencing Insolvency Proceedings had already seized to be the owner of the said property having no physical control on the said property. Further pleaded that undisputedly the Moratorium had commenced with effect from 06.02.2018 i.e. the date of Admission of Petition of SBI moved u/s.7 of The Code. 6. Ld. Counsel has pleaded that in a situation when the physical possession had already been taken before the date of commencement of Moratorium , therefore, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 8. In the Rejoinder, Ld. Counsel has informed that Dena Bank is not a member of Consortium of Banks, therefore, its claim is an independent claim. It has also been informed that the Applicant Bank was invited to attend Committee of Creditors meeting held on 22.02.2018 by IRP since its name was appearing in the Balance Sheet of the Corporate Debtor as a Creditor to the extent of ₹8.65 Crores as on 31.03.2018. The Applicant had attended the said meeting of the Committee of Creditors. The Applicant, vide a proposal dated 30.12.2011, sanctioned the impugned Term Loan of ₹7.50 Crores under a Loan Scheme, which was an exclusive Scheme floated by the Bank, having no connection with other Loans provided by the members of the Consor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that Dena Bank had only taken over the possession, but did not sale the property. At this juncture, it is worth to mention that in the decision of Transcore vs. Union of India (supra), the Hon'ble Court has held that the rights in the asset can be dealt with by a Financial Institution as if it is the Owner of such an asset. The Hon'ble Court has thus held that the Ownership is a deemed Ownership and not the actual Ownership and in that capacity the Bank/ Financial Institution can exercise their right as if the Owner of the asset but not the actual Owner. The connotation used, as if , is highly significant giving an indication that the Ownership is a deemed Ownership. The outcome of this discussion is that the IRP is duty bound to i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e property of the Corporate Debtor. In my humble opinion, the construction of the sentence of Sub-section (c) of Section 14(1) to be read along with other Sub-sections refer the instance happened in the past. To elaborate this point, according to me, if an action has been taken to enforce any security interest created under SARFAESI Act, then prohibition shall be ordered by Adjudicating Authority. 10.1. The above opinion can be further buttressed by examining the definition of security interest as defined u/s.3(31) of the Insolvency Code, reproduced for ready reference. (31) security interest means right, title or interest or a claim to property, created in favour of, or provided for a secured creditor by a transaction which se ..... X X X X Extracts X X X X X X X X Extracts X X X X
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