Tribunal upholds decision on composite Resolution Plan violating Lease Deed terms

The Tribunal upheld the Adjudicating Authority's decision, dismissing the appeals and affirming that the composite Resolution Plan violated the terms of the Lease Deed and was not permissible under the IBC. The Tribunal emphasized the need for compliance with legal provisions and protection of stakeholders' interests.

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Issues Involved:
1. Validity of the Application filed by NOIDA.
2. Jurisdiction of the Adjudicating Authority.
3. Compliance with Lease Deed and Sub-Lease Deed terms.
4. Validity of the Composite Resolution Plan.
5. Principles of Natural Justice.

Summary:

1. Validity of the Application filed by NOIDA:
The NOIDA filed an application seeking directions not to accept the composite Resolution Plans for Neo Infrastructure Pvt. Ltd. and Brys International Pvt. Ltd., and to stay the voting on these plans. The Adjudicating Authority allowed the application, concluding that the application was not infructuous even after the CoC approved the Resolution Plans on 28.02.2020. The Authority held that the terms of the Lease Deed were violated and the composite Plan was not permissible.

2. Jurisdiction of the Adjudicating Authority:
The Appellants argued that the Adjudicating Authority exceeded its jurisdiction and that the application was infructuous. The Adjudicating Authority maintained jurisdiction, citing the need to ensure compliance with the Insolvency and Bankruptcy Code (IBC) and the terms of the Lease Deed. The Tribunal referenced the Supreme Court's ruling in Gujarat Urja Vikas Nigam Ltd. vs. Amit Gupta, affirming that the NCLT has jurisdiction over disputes relating to the insolvency of the corporate debtor.

3. Compliance with Lease Deed and Sub-Lease Deed terms:
The NOIDA claimed that Neo Infrastructure Pvt. Ltd. and Brys International Pvt. Ltd. violated the terms of the Lease and Sub-Lease Deeds by transferring development and sales rights without prior approval. The Tribunal noted specific clauses in the Lease Deed requiring such permissions and held that the Collaboration Agreement transferring these rights was void and inoperative without NOIDA's approval.

4. Validity of the Composite Resolution Plan:
The Adjudicating Authority found that the composite Resolution Plan submitted by E-Homes Infrastructure Pvt. Ltd. was not permissible as it combined the CIRP of two separate corporate debtors without an order of consolidation. The Tribunal emphasized that the RP should ensure that Resolution Plans comply with legal provisions and do not harm stakeholders' interests.

5. Principles of Natural Justice:
The Appellants contended that the Resolution Applicant was not a party to the NOIDA's application, violating principles of natural justice. The Tribunal dismissed this argument, noting that the RP, who was responsible for the CIRP and had filed a reply opposing the application, was a party and was heard. The Tribunal concluded that the composite Resolution Plan was a device to harm stakeholders' interests, especially NOIDA.

Conclusion:
The Tribunal upheld the Adjudicating Authority's decision, dismissing the appeals and affirming that the composite Resolution Plan violated the terms of the Lease Deed and was not permissible under the IBC. The Tribunal emphasized the need for compliance with legal provisions and protection of stakeholders' interests.

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