2022 (11) TMI 1072 - AT - Insolvency and Bankruptcy

NCLAT Upholds Costs for Delayed Liquidation | Land Valuation Affirmed | Appeal Dismissed

DD Real Estate Private Limited (Holding Company of Forgings Private Limited) Versus Mr. Sajeve Bhushan Deora (Liquidator for Forgings Pvt. Ltd.), Indiabulls Housing Finance Ltd., Mars Infraengineering Pvt. Ltd., Late Davinder Kumar (Sole Bidder 75% Share)

DD Real Estate Private Limited (Holding Company of Forgings Private Limited) Versus Mr. Sajeve Bhushan Deora (Liquidator for Forgings Pvt. Ltd.), ... Issues Involved:1. Challenge to the Impugned Order dated 24.03.2021.2. Request for fresh valuation of land.3. Nature and valuation of the land in question.4. Imposition of costs on the Appellant for delaying the liquidation process.Issue-wise Detailed Analysis:1. Challenge to the Impugned Order dated 24.03.2021:The appeal challenges the order of the National Company Law Tribunal (NCLT), Principal Bench, New Delhi, which dismissed the application filed by the Appellant and imposed costs of Rs. 1,00,000/- to be paid to the Corporate Debtor Company. The NCLT had previously imposed costs of Rs. 50,000/- on the Appellant in a related matter (CA 1079/2019).2. Request for Fresh Valuation of Land:The Appellant, M/s. DD Real Estate Private Limited, the Holding Company of the Corporate Debtor, sought a direction for fresh valuation of the land sold to the bidder under Regulation 35(2) of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016. The land in question is located at 12/6 Village Sarai Khawaja, main Mathura Road, Faridabad, Haryana. The NCLT had previously determined that the base price of Rs. 52.58 Crores was higher than the circle rate of agricultural land and was reflective of the development potential of the property. Despite opportunities, the Appellant failed to identify any bidder willing to purchase the land at a higher price.3. Nature and Valuation of the Land in Question:The Appellant contended that the land was converted from agricultural to industrial use, which should have increased its valuation. However, the NCLT and the National Company Law Appellate Tribunal (NCLAT) found no defect in the valuation reports and upheld that the land was agricultural in nature. The NCLAT noted that the Appellant had failed to produce any evidence or bidder willing to pay a higher price. The Supreme Court also dismissed the Appellant's Civil Appeal, thereby upholding the NCLAT's findings.4. Imposition of Costs on the Appellant for Delaying the Liquidation Process:The NCLT and NCLAT both observed that the Appellant's actions were aimed at delaying the liquidation process without any substantial basis. The NCLT imposed costs of Rs. 1,00,000/- on the Appellant for filing repetitive and baseless litigation. The NCLAT confirmed these costs, emphasizing that the Appellant's conduct was intended to hinder the liquidation proceedings.Conclusion:The NCLAT dismissed the appeal, confirming the costs imposed by the NCLT. The Tribunal held that the issue of land valuation and its nature had attained finality through multiple rounds of litigation, including decisions by the Supreme Court. The Appellant's repeated attempts to challenge the valuation and nature of the land were deemed to be without merit and aimed at delaying the liquidation process. The appeal was dismissed with no further order as to costs.