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TMI Blog2023 (1) TMI 190X X X X Extracts X X X X X X X X Extracts X X X X ..... sale deed registered in their favour with the NOC to be issued by the Appellant as they are not at all at fault because they had no control over the escrow account and had discharged their liability as a prospective buyer in terms of the agreement to sell, to pay sale consideration which was either to be credited to the account of the Appellant by the borrower or agent of the escrow account. The Adjudicating Authority has also recorded its findings in para 3 of the impugned order that the home buyers have paid entire sale consideration, therefore, they would be at par with 17 such other home buyers to whom NOC was issued by the Appellant after receipt of the entire sale consideration and if the equities are to be balanced on the same scale, we find weight in the case of the home buyers. There are no error in the approach of the Adjudicating Authority which requires any kind of interference in this appeal - appeal dismissed. - Company Appeal (AT) (Ins) No. 183 & 184 of 2022 - - - Dated:- 4-1-2023 - [ Justice Rakesh Kumar Jain ] Member ( Judicial ) And [ Mr. Kanthi Narahari ] Member ( Technical ) For the Appellant : Mr. Rohit Sharma , Mr. Ashok Kumar , Advocates ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Casa and Villa/Row House Nos. 2,6,7,8,10,11,12,14,18,32 99 of Bella Capanna by issuing NOC for execution of sale deed after receipt of proportionate payment regarding those units. It has also come on record that the Appellant issued 103 conditional NOCs to certain banks for facilitating the allottees of the said respective units to avail home loans from the said banks/financial institutions but with the condition that HUDCO shall have charge on entire project of the Corporate Debtor and that final transfer shall take effect only after full cost of the flat is received in the escrow account and when HUDCO conveys its decision to discharge the mortgage pertaining to the specific flat in writing. 6. It is alleged that besides the aforesaid NOCs, HUDCO had issued 6 conditional NOCs to the allottees on the condition that the entire sale consideration for the said 6 flats shall be directly deposited by the said allottees into the bank account of HUDCO. 7. HUDCO disbursed a sum of Rs. 31.35 Crores of the sanctioned loan amount under both the loan agreements dated 30.06.2009 and 31.08.2010 but the Corporate Debtor failed to maintain the financial discipline and thus the loan accounts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ttees of the project of the Corporate Debtor approached the High Court of Bombay, Nagpur Bench by way of Writ petition No. 6066 of 2014 and Writ Petition No. 6917 of 2014 requesting that HUDCO be directed to issue NOC in their favour on the ground that they have paid the entire sale consideration towards the purchase of the said units, except the amount which were to be paid at the time of execution of sale deed. The said writ petition was dismissed by the High Court of Bombay, Nagpur Bench on 13.06.2016. The allottees challenged the order dated 13.06.2016 by way of SLP (C) No. 5993 of 2017. The said SLP was dismissed on 22.04.2019 by the Supreme Court. 13. It is also the case of the Appellant that it learnt through the report of the auditors M/s Jain Khetan Agrawal and Associations that the Corporate Debtor, acting through its directors Sudesh Chandra Sandesh Chandra Gupta, has fraudulently sold 60 units in the project without obtaining NOC from HUDCO and diverted the sale proceeds of the said flats to some purpose other than repayment of the outstanding dues payable to HUDCO in terms of the loan agreements. The Corporate Debtor through its directors and authorized signatory ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 24.07.2020, 20 allottees of the project of the Corporate Debtor i.e. Respondent No. 4 to 23 herein filed an application bearing I.A. No. 178 of 2020 in CP (IB) NO. 451/ALD/2019 seeking NOC from the Appellant for the execution of sale deeds to which reply was filed on 18.09.2020 pointing out that HUDCO has a prior charge over the project of the Corporate Debtor and the constructions raised thereon. The Appellant filed an application i.e. I.A. No. 236 of 2020 for inclusion of all the residential units of the project in the inventory of the Corporate Debtor s asset that will be offered to the PRA. While that application was pending, on 04.10.2020 other allottees i.e. Respondent No. 4 to 19 filed an application bearing I.A. No. 302 of 2020 praying for the similar relief as claimed in I.A. No. 178 of 2020. It is further alleged that HUDCO filed an application i.e. I.A. No. 262 of 2020 in CP (IB) No. 451/ALD/2019 on 05.10.2020 seeking for setting aside the CIRP of the Corporate Debtor on the ground that Operational Creditor i.e. Khard Enterprise and the Corporate Debtor are related parties. It is also alleged that 20 other allottees of the project filed an application bearing I.A. No. 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It is further submitted that two escrow agreements were also executed on 30.06.2009 and 31.08.2010. UBI was the trustee of the escrow accounts and as per Article 5.5 of escrow agreement, all receipts accruing to the borrower (CD) from the project was to be deposited by the borrower in the escrow account. It is categorically stated that the Corporate Debtor committed a default in payment of the loan amount and also violated the escrow agreement by failing to deposit the amounts received from the home buyers including the applicants in the escrow account. It is further argued that the amount deposited in the escrow account may also have been siphoned off by the Corporate Debtor. It is submitted that the homebuyers have no privity of contract with the Appellant who have entered into an agreement to sell with the Corporate Debtor after the mortgage was created in favour of the Appellant which is duly recorded in the agreements. It is also recorded in the agreements that final transfer of the units shall be made only after the entire payment of the apartment is made by the purchaser and the payable amount for the concerned unit is paid to the Appellant. It is also argued that conditiona ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had, in the past, issued NOC in respect of 17 such units for the purpose of registration of the sale deed from whom the amount was received. The said unit holders had deposited sale price in the escrow account, therefore, the Appellant cannot discriminate between the same home buyers in this regard. It is further submitted that the homebuyers had performed their part of the contract by depositing the amount of the sale consideration and had no control or role in the operation of the escrow account which was opened with the understanding of the Appellant, CD and the UBI. Funds from the escrow account could not have been released without permission of the Appellant and if any such thing has happened, as alleged by the Appellant that the amount has been siphoned off from the said account at the instance of the Corporate Debtor, the Appellant has to blame itself instead of blaming the home buyers who are already in possession of their units but are waiting for the conveyance deeds to become the absolute owner. 26. Counsel for Respondent No. 1 2 has submitted that as soon as the impugned order was passed, the requests was sent to the Appellant to execute the sale deed. It is furthe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he payments of the entire sale consideration, therefore, they are entitled to get the sale deed registered in their favour with the NOC to be issued by the Appellant as they are not at all at fault because they had no control over the escrow account and had discharged their liability as a prospective buyer in terms of the agreement to sell, to pay sale consideration which was either to be credited to the account of the Appellant by the borrower or agent of the escrow account. 31. The Adjudicating Authority has also recorded its findings in para 3 of the impugned order that the home buyers have paid entire sale consideration, therefore, they would be at par with 17 such other home buyers to whom NOC was issued by the Appellant after receipt of the entire sale consideration and if the equities are to be balanced on the same scale, we find weight in the case of the home buyers. 32. Thus, in view of the aforesaid discussion, we do not find any error in the approach of the Adjudicating Authority which requires any kind of interference in this appeal. Hence, the present appeal is hereby dismissed. However, with no order as to costs. - - TaxTMI - TMITax - Insolvency & Bankruptc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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