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TMI Blog2022 (12) TMI 478X X X X Extracts X X X X X X X X Extracts X X X X ..... 021 in CP(IB) No. 1022/(ND)/2018. By the Impugned Order, the Adjudicating Authority approved the Resolution Plan of the Corporate Debtor without disposing IA Nos. 5333/2020 and 1587/2021 filed by the present Appellant and therefore aggrieved by the impugned order, the present appeal has been preferred by the Appellant. 2. The brief facts of the case necessary to be noticed for deciding the appeal are: - M/s Rohtas Projects Limited, the Corporate Debtor was allotted a plot of land in Sector 140, Noida in 2007 by the Noida Authority for construction and setting up of an Information Technology Enabled Services (IT & ITES) commercial complex. The lease deed in favour of Corporate Debtor was executed on 22.10.2008 by which the Corporate Debtor came to have possession of the said plot of land. The Corporate Debtor later entered into an Agreement to Sell ("Agreement" in short) on 14.04.2015 with M/s Indo World Infrastructure Private Limited, the present Appellant by virtue of which the Appellant got rights for construction and development of 6,00,000 sq. ft. therein (hereinafter referred to as the 'Project land'). The Appellant in turn had entered into a sub-contract with Antriksh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tor; c. directing Resolution Professional to return the possession of the said property to the Applicant without any further delay; and d. pass any such order(s) as may be deemed necessary. Aggrieved by the fact that these two IAs filed by the Appellant remained undisposed, while the Adjudicating Authority went ahead and approved the Resolution Plan of the Corporate Debtor in IA No.2871/2021, the Appellant has preferred this appeal. 3. Making his submissions, the Learned Counsel for the Appellant claimed that by virtue of Agreement signed between the Corporate Debtor and the Appellant, the Appellant had acquired ownership and taken over possession of 6,00,000 sq. ft. in the said plot for development and construction of the project. It was further submitted that Article 13 of the Agreement gave unfettered rights to the Appellant to sell the allotted area of 6,00,000 sq. ft. to customers and that the Appellant had further entered into a sub-contract with Antriksh Real Estate Builders Private Limited for construction of the project. Hence, the dispossession of the Appellant from the project land by the Respondent No.1/Resolution Professional was illegal. 4. The Learned Counsel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contention that the Appellant are absolute owners of the plot by virtue of the Agreement signed with the Corporate Debtor. It is contended that the Agreement does not grant any ownership rights to the Appellant. The said project land was obtained from the Noida Authority vide a lease deed dated 22.10.2008 executed between Noida Authority as the lessor and the Corporate Debtor as the lessee. Clause 14(b) of the Lease Deed clearly provides that sub-lease can be done by the Corporate Debtor only with the prior approval of Noida Authority being the lessor. Thus separation of the plot could not have been done without prior permission of Noida Authority, and in the present case the Appellant had failed to provide any No Objection Certificate from the Noida authority in this regard. Hence, the Agreement executed between the Corporate Debtor and the Appellant in the absence of any permission from Noida authority is null and void and the Agreement cannot be the basis for the Appellant to claim ownership of the said project land. 8. It was further submitted that by merely entering into an Agreement to Sell does not amount to ownership of the property and that ownership of property is trans ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inst an order approving Resolution Plan, the Learned Counsel for the Respondent pointed out that Section 61(3) of the IBC stipulates specific grounds for preferring an appeal against an order of the Adjudicating Authority approving a Resolution Plan under Section 31 of the IBC. Since the Appellant has failed to show any contravention of provisions of any law or material irregularity in the exercise of power by the Respondent No.1/Resolution Professional, it was argued that there are no sufficient grounds for preferring an appeal in the matter. Further, reliance was placed upon the judgment of Hon'ble Supreme Court in the case of K. Sashidhar v. Indian Overseas Bank (2019) SCC OnLine SC 257 to claim that the jurisdiction bestowed upon the Appellate Authority to entertain appeals is also expressly circumscribed. It was also categorically pointed out that the Appellant has not been able to substantiate that the Resolution Applicant is a related party of the Corporate Debtor. 11. Advancing the arguments further, it is submitted that while adjudicating any application for approval of Resolution Plan under Section 31 of the IBC, the Adjudicating Authority is required to limit its scruti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from Noida authority after executing a Lease deed on 22.10.2008; (ii) whether the Resolution Professional/Respondent No.1 by including the project land in the pool of assets of the Corporate Debtor had acted beyond the statutory framework of IBC; and (iii) whether the approval of the Resolution Plan of the Corporate Debtor by the Adjudicating Authority without deciding the two IAs filed by the Appellant suffered from impropriety. Point No. (i) 15. The rival contentions of the two sides have been noted. According to the Appellant, by their entering into the "Agreement to Sell" with the Corporate Debtor and also having paid certain amounts on behalf of the Corporate Debtor to the Noida Authority, there has taken place a transfer of ownership of the project land from the Corporate Debtor to them. On the other hand, the Resolution Professional/Respondent No.1 contends that mere signing of the Agreement does not result in transfer of ownership of the asset and that even if the Appellant had made payments to the Noida Authority, that does not make them owner of the project land and that in respect of such payments made, the Appellant could have filed claim before the Resolution Pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... completion of the said complex and obtaining the Occupation Certificate and expenses incurred for the same shall be borne by the SECOND PARTY. This is however subject to the terms of Lease Deed and applicable laws, bye-laws, rules, regulations etc of NOIDA Authority. ****** ******* ******* 26. That the clauses of this agreement shall not supersede the lease agreement executed between the FIRST PARTY and NOIDA development authority. That both the parties and their allottees shall be bound by the terms & condition above said lease agreement executed between FIRST PARTY and NOIDA development authority." (Emphasis supplied) 19. The Lease Deed clauses make it abundantly clear that for any sub-lease to be entered into by the Corporate Debtor, there were two pre-requisites to be met. First, that the unit was to be made functional and, secondly, that the prior approval of Noida authority being the lessor had to be obtained and that in the absence of such permission all actions for transfer of the demised land and thereby any claim of transfer of ownership rights will be deemed to be ab initio null and void. We have noted that the Appellant has not staked any claim of having complet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y by a registered instrument and an agreement of sale does not create any interest or charge on its subject matter." 21. It is therefore a settled proposition of law that an Agreement to sell does not convey a property from one person to another, either in present or even in future. Agreement to sell is a promise of a future transfer of property ownership which outlines the terms and conditions under which the property will be transferred. An agreement to sell an immovable property is therefore a bilateral contract under which the two parties, i.e. the buyer and the seller, agree to certain terms and conditions, subject to which the property in question would be transferred by the seller to the buyer for a decided sale consideration. It is only after such bilateral obligations are discharged that the execution of the sale deed kicks in and it is this sale deed, which is compulsorily registrable under the Registration Act, 1908, which upon being registered, would transfer the right, title and interest in the property in question on to the purchaser. In the present factual matrix, the agreement to sell was yet to culminate into a registered sale deed and therefore not ripe for trans ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tors; (e) file information collected with the information utility, if necessary; and (f) take control and custody of any asset over which the corporate debtor has ownership rights as recorded in the balance sheet of the corporate debtor, or with information utility or the depository of securities or any other registry that records the ownership of assets including- (i) assets over which the corporate debtor has ownership rights which may be located in a foreign country; (ii) assets that may or may not be in possession of the corporate debtor; (iii) tangible assets, whether movable or immovable; (iv) intangible assets including intellectual property; (v) securities including shares held in any subsidiary of the corporate debtor, financial instruments, insurance policies; (vi) assets subject to the determination of ownership by a court or authority; (g) to perform such other duties as may be specified by the Board. Explanation.-For the purposes of this section, the term "assets" shall not include the following, namely- (a) assets owned by a third party in possession of the corporate debtor held under trust or under contractual arrangements including ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g out what was the main issue raised in IAs 1833/2021 & 4904/2021 and how the IAs were treated by the Adjudicating Authority. In IA No. 1833/2021, the main issue raised was to exclude the Rohtas Presidential Tower, Vibhuti Khand, Gomti Nagar, Lucknow from the Corporate Insolvency Resolution Process of the Rohtas Projects Limited. In IA No. 4904/2021 too, the issue raised was to exclude the Rohtas Presidential Tower Project of the Corporate Debtor situated at Vibhuti Khand, Gomti Nagar, Lucknow from the Corporate Insolvency Resolution Process of the Corporate Debtor thereby excluding the same from the Resolution Plan proposed by the Prospective Resolution Applicant. The Adjudicating Authority while disposing the IAs had come to the following finding: "It is clear that the Applicants in both the IAs are aware about the CIR Proceeding of Corporate Debtor and they were also represented by Authorized representative during the CoC meetings. In case, they have any grievance with respect to inclusion of their project in the asset of Corporate Debtor, they could have raised the same at much earlier stage and not after the approval of resolution plan by CoC. It is also pertinent to mention ..... X X X X Extracts X X X X X X X X Extracts X X X X
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