9911796707
TMI Blog2021 (7) TMI 1234X X X X Extracts X X X X X X X X Extracts X X X X ..... atasubramanian, (RP, In Person), Ms. Niharika Sharma, Mr. Sanjay Bhat, Advocates for Respondent No. 3, RP Mr. Sumesh Dhawan, Mr. Vatsala Kak and Ms. Geetika Sharma, Advocates for Respondent No. 5. For Suspended Board of Directors. ORDER Justice Anant Bijay Singh, I.A. No. 915 of 2021 in Company Appeal (AT) (Insolvency) No. 654 of 2020 has been filed by Applicant -'M/s Vistra ITCL (India) Limited' on 29.04.2021 under Rule 31 read with Rule 11 of the National Company Law Appellate Tribunal Rules, 2016 for seeking clarification to an observation in paragraph 24 of the Judgment dated 16.04.2021 passed by this Hon'ble Tribunal in Company Appeal (AT) (Insolvency) No. 654 of 2020 (Deccan Value Investors L.P. V/s Dinkar T. Venkatasubramanian & Ors.) being "lease has been entered into in accordance with law for renewing the existing lease hold rights." 2. The plea taken in the I.A. No. 915 of 2021 and also during the course of argument Mr. Sudhir K. Makkar, Sr. Advocate appeared on behalf of the Applicant submitted that the said observation resulted in anomalous situation is contrary to the intent and ratio of the judgment and is seemingly incongruous to the directions and observations ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bject Property, any lease created after such encumbrance was not lawful and if a tenancy/lease under law came into existence after the creation of a mortgage, but prior to issuance of SARFAESI notice, it had to satisfy the conditions of Section 65-A of the TPA. The Applicant thus contended that the 2020 Lease Deed entered by the resolution professional for a period of 20 years despite existence of a valid mortgage, was contrary to the law. 7. It was further contended by the Applicant before the Ld. Adjudicating Authority that it was incumbent upon the resolution professional to ensure that the resolution plan does not contravene any of the provisions in law for the time being in force. In the present case, the Resolution Professional was not only aware of the contravention; he actively participated in such contravention. The creation of the 2020 Lease Deed on 28.01.2020 i.e. after the SARFAESI Notice was issued on 21.01.2020, was blatantly illegal as it was in clear contravention of Section 65A of TPA and Section 13(13) of SARFAESI. It was thus contended before the Ld. Adjudicating Authority that the resolution professional did not act in accordance of Section 30(2) of the Code. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o of any order cannot be sustained. 14. Learned Sr. Counsel for the Applicant further submitted that this Hon'ble Tribunal to arrive at a finding that the 2020 Lease Deed was allegedly created validly as the said question was not even the subject matter of the appeal filed by the Appellant nor was any such contention canvassed before this Hon'ble Tribunal during the course of arguments. The Ld. Adjudicating Authority has categorically refused to grant any of the reliefs as sought qua the Ace Complex Land and had exercised its enforcement right by issuing the SARFAESI Notice on 21.01.2020. Hence, creation of any tenancy rights by way of a lease pursuant to issuance of the SARFAESI Notice has to be examined in light of relevant laws before the Appropriate Forum, which question was rightly left open by the Ld. Adjudicating Authority. 15. It was further submitted that the Impugned Observation, besides being factually inaccurate, is ex facie unintended and completely out of line with the rest of the order and has the effect of contradicting the other parts of the order. The said observation is thus an error apparent on face of the record and requires to be corrected lest the o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yed for in pending matters shall be in Form NCLAT-2 and the requirements prescribed in that behalf shall be complied with by the applicant, besides filing a affidavit supporting the application." 20. Learned Counsel for the Respondent - 'Resolution Professional' during the course of argument and also in the written submissions relied on the judgment of Hon'ble Supreme Court in 2000 (7) SCC 297 (Delhi Administration V/s Gurdip Singh Uban and Others) and referred to paragraph 16 and 17 which are reads as under; "16. At the outset, we have to refer to the practice of filing review applications in large numbers in undeserving cases without properly examining whether the cases strictly come within the narrow confines of Rule XL of the Supreme Court Rules. In several cases, it has become almost everyday experience that review applications are filed mechanically as a matter of routine and the grounds for review are a mere reproduction of the grounds of special leave and there is no indication as to which ground strictly fails within the narrow limits of the Rule XL of the Rules. We seriously deprecate this practice. If parties file review petitions indiscriminately, the time of the cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udgment of Hon'ble Supreme Court that this instant application which has been filed by the Applicant for clarification of the judgment, in reality this instant application seeks a review and wants rehearing of the Judgment passed by this Tribunal in this matter instead of clarification of the judgment and the IBC does not have any provisions to review/rehear any judgment and thus it is a frivolous application. Therefore, it is fit to be dismissed. 22. After hearing both the sides, we have taken note of the fact that there are no provisions in the IBC which permits us to review the judgment passed by this Tribunal. Further, the relevant paragraphs of the judgment passed by this Tribunal read as under: "18. As regards impleadment sought by Vistra it is submitted that the Appeal arises out of proceedings under Section 31 of I&B Code to which Vistra was not even a party. It is submitted that Vistra had filed CA No.62 of 2020 and CA No.237 of 2020, which was disposed off in terms of the impugned order. Vistra has only challenged order passed in CA No.62 of 2020 and no challenge has been raised in regard to order passed in CA No.237 of 2020. Once Appeal has not been filed, Vistra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of Appellant's prayer for withdrawal of the Resolution Plan, the order passed by the Hon'ble Apex Court gives a loud and clear message that any further attempt made by the Appellant to enact a U-turn and try to wriggle out of the obligations under the offer would be treated as contumacious conduct inviting action for Contempt of Court. This appears to have been done to deter the Appellant from resiling from its offer. The order dismissing the Application is final and has to be construed as a bar precluding the Appellant from seeking exit from its own offer. It also emerges from the order that the Hon'ble Apex Court, while rejecting the withdrawal offer emanating from Appellant, took notice of the various orders passed by it at the instance of Appellant. The tone and tenor of this order leaves no scope for the Appellant to resile from and wriggle out of the implication of the offer made by him, i.e. the Resolution Plan, which has been approved in terms of the order impugned in this Appeal. It is therefore manifest that the Appellant would not be permitted to backtrack and seek exit from its Resolution Plan on any pretext whatsoever. This is a closed chapter and cannot be permitt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proceedings, thereafter permitted RP to invite fresh offers from prospective Resolution Applicants. COC was directed to take a final call thereafter. Subsequently, the Hon'ble Apex Court extended time by three weeks to enable COC to take decision. It further ordered that consideration be confined to five offers received within time. Subsequently, earlier order was recalled and RP was directed to invite fresh offers within thirty days of advertisement. COC was directed to evaluate the Plans within three weeks thereafter. COC after evaluation of Plans submitted by four prospective Resolution Applicants declared Appellant as H1 bidder. The Hon'ble Apex Court extended time by two weeks for concluding the voting on Resolution Plan of Appellant. The Resolution Plan with its addendum was placed before COC which was approved by it within the further extended time by 70.07% votes. Vide order dated 8th June, 2020, the Hon'ble Apex Court, keeping in view this development, relegated the matter of IA No.48906/2020 in Civil Appeal No.6707/2019 to AA for consideration and appropriate orders within fifteen days. It emerges from the impugned order that this IA, filed by COC, sought approval of Res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a, Haryana (Ace Complex Land) owned by Gateway. However, it is submitted that this condition was not a condition precedent to the approval and acceptance of the Resolution Plan. Sub-clause 2.5.2 of the approved Resolution Plan replaced by the addendum (page 550,551 of Vol. 3 of Appeal paper-book) brings it to fore that the Resolution Plan envisaged acquisition of the CD by the Appellant as a going concern and contingent on conditions including execution of a long term lease (subsisting for 20 years or more) for the Ace Complex Land with Acceptable Terms. At page 547 of the same Volume, we find Clause 2 substituting sub-section 1.8(iii), 1.6(vi) and insertion of 1.9 on the commercial proposal of Appellant for running the Corporate Debtor as going concern, wherein provision has been made to include purchase of Ace Complex Land. It is provided that the Appellant proposes to negotiate with Vistra for purchase of Ace Complex Land through its subsidiaries etc. The Appellant undertook to infuse purchase funds for purchase of Ace Complex Land at its discretion. Upon its purchase, Appellant would retain the right to not require the sale of the vacant area by the Corporate Debtor for six mon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... suring continued availability of land for operations of the Corporate Debtor. Thus, there was no impediment in implementing the Resolution Plan and assailing of the approved Resolution Plan by Appellant who itself is the Successful Resolution Applicant is unwarranted. LOI may have been stipulated to ensure that the Resolution Applicant is rendered accountable. Requirement of submission of PBG is in consonance with Regulation 36B of the CIR Regulations. The submission of PBG was a condition prefaced upon approval of the CoC and passing of directions by Hon'ble Apex Court. It is significant that the Appellant had undertaken to place PBG of Rs. 300 Crore in the Resolution Plan itself. Thus, it was bound to comply with the requirement and not hide behind the issue raised in respect of LOI to not adhere to the requirement of submission of PBG. After approval of Resolution Plan by the CoC, the Hon'ble Apex Court vide order dated 8th June, 2020 relegated the matter to NCLT for approval of Resolution Plan. The Appellant was a party to the proceedings before the Hon'ble Apex Court and question of intimating it by way of issuance of LOI became irrelevant. Appellant cannot be heard to backtra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Resolution Plan of Appellant under the garb of seeking impleadment. Same is true in respect of intervention sought by Kotak Mahindra Bank. 27. For the foregoing discussion, we are of the considered view that the execution of long term lease for the Ace Complex Land with Acceptable Terms was not a condition precedent in regard to approval of Resolution Plan but only in regard to effective date. The impugned order does not travel beyond the scope of enquiry under Section 31 of I&B Code. The condition in regard to execution of a long term lease for the Ace Complex Land having already been complied with by RP who executed the lease on 28th January, 2020, when the prior lease has expired on 31st March, 2019 and Vistra not having assailed the impugned order for any material irregularity in the insolvency resolution process resulting in prejudice, the Appellant would not be justified in assailing the impugned order which, in effect, is nothing but yet another effort to wriggle out of its obligations and seek withdrawal of Resolution Plan in a different garb. The appeal not only lacks merit but also is frivolous. We, while dismissing the appeal, impose costs to the tune of Rs. 1/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt in 'Forech India Ltd.', this Appellate Tribunal held that the application under Section 7 of the I & B Code filed by the Respondent - 'SREI Equipment Finance Ltd.' was not maintainable. This observation regarding the application of 'SREI Equipment Finance Ltd.' being not- maintainable has raised a storm as the same is interpreted as being an observation having direct nexus with the observations of Hon'ble Apex Court in 'Forech India Ltd.' judgment. Though, efforts were made on the part of one of the applicants to expand the scope of application under Rule 11 of the NCLAT Rules, we have no doubt in mind that the Rule 11 is of a limited scope and does not admit of reviewing the findings on merit or revising the judgment. Rule 11 of the NCLAT Rules is reproduced hereunder:- "11. Inherent powers. -Noting in these rules shall be deemed to limit or otherwise affect the inherent powers of the Appellate Tribunal to make such orders or give such directions as may be necessary for meeting the ends of justice or to prevent abuse of the process of the Appellate Tribunal " Rule 11 is merely declaratory in the sense that this Tribunal is armed with inhe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nterlocutory Application Petition for stay/direction/dispense with/condone delay/calling records The applicant above named state/s as follows : 1. Set out the relief (s) 2. Brief facts 3. Basis on which interim orders prayed for 4. Balance of convenience, if any : (All interlocutory applications shall be supported by an affidavit sworn by the Applicant/on its behalf and attested by a Notary Public). DECLARATION The applicant above named hereby solemnly declare that nothing material has been concealed or suppressed and further declare that the enclosures and typed set of material papers relied upon and filed herewith are true copies of the originals or fair reproduction of the originals or true translation thereof. Verified at_________dated at _______this day __________of _______20 . Counsel for Applicant Applicant VERIFICATION I __________________(Name of the applicant) S/o.W/o.D/o. (indicate any one, as the case may be ) ___________age ____________working as __________ in the office of _______________resident of _______________ do hereby verify that the contents of the paras _____________to ___________are true to my personal knowledge / derived from official ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
