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TMI Blog2022 (1) TMI 264X X X X Extracts X X X X X X X X Extracts X X X X ..... rity Deposit or Maintenance Advance towards the outstanding dues. In the absence of any communication or initiation by the Appellants to the Respondents regarding adjustments made against the Security Deposit or the Maintenance Advance, it is evident that no such adjustments have been made by the Appellant. A perusal of the Maintenance Agreement shows that in the event of non-payment of Maintenance Charges by the Respondent, the only right that accrues upon the two Appellants is to disconnect/discontinue the electric supply to the premises. Further, the Respondent looses their right to use the common facility and services specified in the Maintenance Agreement. The Agreement does not empower the two Appellants with any right to deduct the Maintenance Advance on account of non-payment of Maintenance Charges. It is seen from the record that the RP prepared and submitted a comparative table of amounts and placed before the CoC, dues payable upto 15.09.2020. Having regard to the provisions of Section 14 of the Code, Regulations 13 and 14 of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 and Section 25(2) which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment is effective and valid; iv. A declaration that the Lease Deed and Maintenance Agreement stand terminated with effect from 15.09.2020 consequent to the Termination Notice and after exclusion of the Lockdown Period from 25.03.2020 to 28.07.2020. v. Pass an order granting the Corporate Debtor full waiver of the Lease Rent and Maintenance Charges payable under the Lease Deed and Maintenance Agreement, respectively, for the entire Lockdown Period from 25.03.2020 to 28,07.2020; vi. A declaration that the outstanding Lease Rent and Maintenance Charges payable by the Corporate Debtor to the Respondents shall be calculated treating 15.09.2020 as the date of termination of the Lease Deed, Maintenance Agreement and in accordance with the calculation provided in Exhibit A1 ; vii. Pass an order restraining the Respondents from deducing/adjusting any amounts from the Security Deposit and/or Maintenance Advance available with them towards the admitted claims of the Respondents as admitted by the applicant at the commencement of the CIRP of the Corporate Debtor. 2. The first Appellant M/s. Nimitaya Infotech Private Limited is the Land Owner of the building and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted to file their claim before the RP for the unpaid rent from 25.03.2020 to 28.07.2020 and not beyond that. Delay if any in filing the claim of the Respondents stands condoned. We direct the above because the RP is bound by the provisions of the Code and thus is not allowed to give preferential treatment over the other claimants. The RP has to collate the claim and then prepare a list as per the criteria under Section 53 of the Code. 22. We also direct that the Termination Notice dated 13.02.2020 to terminate the Lease Deed and Maintenance Agreement is valid and effective from 15.09.2020. After careful perusal of the Agreement entered into between the parties and also from the facts of the case it is understood that if the Respondents opt to withhold the security deposit, they will have to forego the rent of the extended period and therefore, we believe that the Respondents cannot/should not withhold the security deposit and hereby are directed to refund the same within a stipulated period of 30 days from the date of this Order. But this does not mean that the Respondents have no right to claim rent of the extended period. Thus, keeping the interest of the Respondents in mind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Agreement, the CoC directed the RP to take possession of the asset and to seek full/partial waiver of rental dues for the lockdown period and decided not to vacate the rental premises. RP filed I.A. 1570/2020 and the Adjudicating Authority held that the rent payable by the Corporate Debtor is an Operational Debt ; the Rent Agreement was admitted to be terminated with effect from 15.09.2020 which does not exclude the lockdown period; refund of Security Deposit by the Appellant within 30 days. It is contended that the Corporate Debtor is liable to pay the Rent and Maintenance Charges until the date of handing over possession as per the terms of Agreement and till date the Corporate Debtor has not vacated the said premises and therefore refunding the Security Deposit within 30 days is contrary to the terms of Agreement. The Adjudicating Authority has erred in observing that the Rent Agreement stands terminated with effect from 15.09.2020. It is the case of the RP that the Termination Notice dated 18.02.2020 was valid until 17.05.2020. Since the RP himself placed before CoC that rent has to be paid till 15.09.2020, it clearly demonstrates that the Corporate Debtor di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tures and other office equipment till outstanding, dues were cleared. Vide email dated 17.07.2020, the Appellants were intimated that with great difficulty, representatives of the Respondents managed to arrange for packers and movers to move the asset of the Company out of the premises and requested the co-operation of the Appellants towards the same. But on 20.07.2020, the Appellants responded that only upon receipt of payment would they cooperate for shifting and removing the asset of the Company. It is contended that in terms of the Termination Notice dated 13.02.2020, the Company made all efforts to ensure vacating the premises on or before 12.05.2020 but the Respondent was not in a position to procure logistical support during the period 25.03.2020 to 28.07.2020 on account of the pandemic and was able to engage the services on the Transport Agencies only on 28.07.2020 and hence the computation of the Notice period restarted on 28.07.2020. Accordingly, the Lease Deed and the Maintenance Agreement stood terminated with effect from 15.09.2020. The Appellants have filed claim forms with the RP where they did not claim any credit for the Security Deposit of ₹ 2.32 Crore ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was initiated against the Corporate Debtor . It is not in dispute that the rents were received up to December, 2019. The claims for amounts towards the Rent and Maintenance Services is subsequent to the CIRP initiation. Clause 13.4 of the Lease Agreement reads as follows: 13.4 Upon expiry of the Lock-in-Period, the LESSEE may terminate the Lease Deed by providing an advance notice in writing of not less than (3) months to the LESSOR or rent in lieu thereof. 8. Learned Counsel for the Appellants vehemently contended that the question of Security Deposit and its refund arises only subsequent to the vacating of the subject premises by the Respondent and not before that. The Learned Council placed reliance on Clause 6.2 of the Lease Deed which refers to the interest free Security Deposit: 6.2: The LESSOR undertakes to refund the Security Deposit simultaneous with the handover of the vacant peaceful possession of the Demised Premises. In the event and despite the LESSEE s demonstration of its willingness to handover vacant peaceful possession of the Demised Premises, the LESSOR fails to refund he unadjusted Security Deposit, the LESSEE shall be entitled to:- 6.2.1: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i-judicial or arbitration proceedings; (c) raise interim finances subject to the approval of the committee of creditors under section 28; (d) appoint accountants, legal or other professionals in the manner as specified by Board; (e) maintain an updated list of claims; (f) convene and attend all meetings of the committee of creditors; (g) prepare the information memorandum in accordance with section 29; (h) invite prospective resolution applicants, who fulfil such criteria as may be laid down by him with the approval of committee of creditors, having regard to the complexity and scale of operations of the business of the corporate debtor and such other conditions as may be specified by the Board, to submit a resolution plan or plans. (i) present all resolution plans at the meetings of the committee of creditors; (j) file application for avoidance of transactions in accordance with Chapter III, if any; and (k) such other actions as may be specified by the Board. .. (Emphasis Supplied) 13. In terms of the provisions of the Code, the RP enjoys the right to take control and custody of all the assets and records of the Corporat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0. Having regard to the provisions of Section 14 of the Code, Regulations 13 and 14 of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 and Section 25(2) which relates to duty of the RP regarding custody of the asset of the Corporate Debtor , we are of the considered view that the Adjudicating Authority has rightly examined the provisions of the Agreement between the parties in detail. However, in para 21 of the Impugned Order, the Learned Adjudicating Authority has observed, Therefore, the Respondents are directed to file their claim before the RP for the unpaid rent from 25.03.2020 to 28.07.2020 and not beyond that . Having taken into consideration the factual matrix of the case on hand, the Minutes of the Meeting held on 09.09.2020 and concluded that the Lease Deed Maintenance Agreement stood terminated as on 15.09.2020, the Learned Adjudicating Authority ought to have directed the Respondents to file their claims, in the interest of justice, upto 15.09.2020. The Order is modified only to this extent while we confirm the rest of the Order of the Learned Adjudicating Authority. 15. This Appeal is partly al ..... X X X X Extracts X X X X X X X X Extracts X X X X
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