2022 (6) TMI 925 - AT - Insolvency and Bankruptcy

Appeal granted, sale deeds to be executed for commercial spaces, protecting homebuyers' rights.

Alok Sharma, Mr. Alok Sharma, Mrs. Neelam Sharma, Mrs. Rashmi Singh, Mr. Ambika Prasad Yadav, Mr. Arun Kumar Yadav, Mrs. Prabha Jain, Mrs. S.R Pandey, Mrs. Soumya Pandey, Mrs. Anju Sharma, Mrs. Neelima Jha, Mr. Rohit Rastogi, Mr. D.K. Pandey Versus M/s. IP construction Pvt. Ltd

Alok Sharma, Mr. Alok Sharma, Mrs. Neelam Sharma, Mrs. Rashmi Singh, Mr. Ambika Prasad Yadav, Mr. Arun Kumar Yadav, Mrs. Prabha Jain, Mrs. S.R Pandey, ... Issues Involved:1. Limitation period for filing the appeal.2. Possession and registration of commercial spaces.3. Applicability of moratorium under Section 14 of the Insolvency and Bankruptcy Code (IBC).4. Rights of homebuyers/allottees in the Corporate Insolvency Resolution Process (CIRP).Issue-wise Detailed Analysis:1. Limitation Period for Filing the Appeal:The Respondent argued that the appeal was barred by limitation as it was filed beyond the prescribed 30-day period under Section 61(2) of the IBC. The impugned order was pronounced on 16.01.2020, and the Appellant approached the Tribunal on 20.02.2020. The Tribunal noted that the appeal was filed within 45 days, which is permissible under the IBC if sufficient cause is shown. The Tribunal referenced the Supreme Court judgment in V. Nagarajan v. SKS Ispat and Power Ltd., emphasizing that the appeal must be filed within 30 days, extendable by 15 days upon showing sufficient cause. Thus, the appeal was deemed within the permissible period.2. Possession and Registration of Commercial Spaces:The Appellants had been in possession of their respective units since 2015, but the sale deeds had not been executed by the Corporate Debtor (CD) before the commencement of CIRP. The Tribunal acknowledged that the possession was given, and the Appellants had made payments, including registration charges. The Tribunal highlighted that the execution of sale deeds is a procedural requirement and is crucial for the Appellants who are already in possession of the units.3. Applicability of Moratorium under Section 14 of the IBC:The Respondent contended that executing the sale deeds would violate the moratorium under Section 14 of the IBC, which prohibits transferring any assets of the CD. The Tribunal clarified that in the case of a real estate company, the sale of constructed spaces is considered 'Revenue from operations' and not an asset sale. Therefore, registering the units does not violate the moratorium. The Tribunal emphasized that the registration of these units is part of the company's commercial operations and should be treated as such.4. Rights of Homebuyers/Allottees in the CIRP:The Tribunal underscored the importance of protecting the rights of homebuyers/allottees in the CIRP. Citing various judgments, including Bikram Chatterjee & Ors. v. Union of India & Ors. and Flat Buyer's Association Winter Hills-77 Gurgaon v. Umang Realtech Pvt. Ltd., the Tribunal noted that the interests of homebuyers should be preserved and protected. The Tribunal stated that the CIRP should not work to the detriment of the allottees but should ensure their rights are safeguarded.Conclusion:The Tribunal set aside the impugned order dated 16.01.2020, dismissing CA No. 2265(PB)/2019 in CP(IB) 593 of 2018. The Tribunal directed the Resolution Professional to execute the sale deeds after collecting any remaining dues and costs. The appeal was allowed, and any pending applications were disposed of. No order as to costs was made.