Tribunal Admits Section 7 Petition for Insolvency against Sapphire Land Developers

The Tribunal admitted the Section 7 petition filed by Suraksha Asset Reconstruction Limited against Sapphire Land Developers Private Limited, appointing Mr. Ankur Kumar as the Interim Resolution Professional. The petition met the requirements for admission under the Insolvency and Bankruptcy Code, as the debt was confirmed, and default established. The Tribunal disregarded the pendency of related proceedings before another NCLT Bench, enforcing a moratorium and initiating the Corporate Insolvency Resolution Process.

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Issues Involved:
1. Maintainability of the Section 7 Petition.
2. Pendency of related proceedings before another NCLT Bench.
3. Alleged double recovery by the Petitioner.
4. Validity of the financial debt and default.

Detailed Analysis:

1. Maintainability of the Section 7 Petition:
The Petitioner, Suraksha Asset Reconstruction Limited, filed Form No. 1 under Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, as a "Financial Creditor," invoking Section 7 of the Insolvency and Bankruptcy Code against Sapphire Land Developers Private Limited (Corporate Debtor). The Corporate Debtor challenged the maintainability of the petition, arguing it was hit by the principle of res sub judice due to related proceedings before another NCLT Bench.

2. Pendency of Related Proceedings:
The Corporate Debtor contended that the Petitioner should have disclosed the pendency of proceedings before Court III, NCLT, Mumbai, which had a bearing on the Section 7 Petition. Specifically, I.A. No. 3473 of 2019 was reserved for orders by Court III, NCLT (Mumbai Bench), which could affect the repayment of the debt owed by the Corporate Debtor. The Corporate Debtor argued that the Tribunal should defer the hearing of the present petition until the outcome of I.A. No. 3473 of 2019.

3. Alleged Double Recovery by the Petitioner:
The Corporate Debtor claimed that the Petitioner's conduct was aimed at obtaining double recovery. It was argued that the Petitioner had already filed its claim before the Resolution Professional of HDIL, which was admitted in its entirety. Additionally, the Petitioner had filed M.A. 3473 of 2019 before Court III, NCLT, Mumbai, seeking directions related to the transfer of the Majestic Towers Project. The Corporate Debtor submitted that admitting the present petition would lead to an unwarranted double benefit to the Petitioner.

4. Validity of the Financial Debt and Default:
The Petitioner, as the assignee of the financial asset from the original lender (Yes Bank), sought recovery of Rs. 206,77,51,421/- due to the default of non-payment by the Corporate Debtor as of 30.06.2017. The Corporate Debtor had availed a term loan of Rs. 150 crores from Yes Bank, which was disbursed in two tranches. The Petitioner provided evidence of the loan sanction and disbursement, including the sanction letter, loan agreement, and other related documents. The Corporate Debtor did not dispute the loan sanction, disbursement, signing of documents, or default but questioned the maintainability of the petition due to the pending proceedings before another NCLT Bench.

Findings:
The Tribunal found that the debt of Rs. 150 crores was sanctioned and disbursed by the original lender, and there was a default of payment from 30.06.2017 by the Corporate Debtor. The Tribunal held that the pendency of M.A. 3473 of 2019 before another NCLT Bench had no bearing on the present application under Section 7 of the I&B Code. The Tribunal concluded that the nature of the debt was a "Financial Debt" as defined under Section 5(8) of the Code, and there was a "Default" as defined under Section 3(12) of the Code. The petition met the essential qualifications for admission under Section 7 of the I&B Code, and the petition was admitted.

Order:
The Tribunal admitted the petition and appointed Mr. Ankur Kumar as the Interim Resolution Professional (IRP) to conduct the Insolvency Resolution Process. The provisions of Moratorium under Section 14 of the Code were made operative, prohibiting the institution of any suit, transferring/encumbering any assets of the Debtor, etc. The IRP was directed to perform duties as assigned under Sections 18 and 15 of the Code and inform the progress of the Resolution Process within 30 days to the Bench. The commencement of the Corporate Insolvency Resolution Process was effective from the date of the order.

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