NCLT Has Jurisdiction Over Eviction Cases Under Insolvency Law; Invalid Eviction Notices Issued by Liquidator

The Tribunal held that the National Company Law Tribunal (NCLT) has jurisdiction to adjudicate eviction matters under the Insolvency and Bankruptcy Code. It found the eviction notices issued by the Liquidator to be invalid due to non-compliance with contractual terms. The Tribunal ruled that the Liquidator can take possession of the property without filing a civil eviction suit, following a precedent upheld by the Supreme Court. Consequently, the Tribunal set aside the previous order and remanded the case for a fresh decision by the Adjudicating Authority.

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Issues Involved:
1. Jurisdiction of NCLT to adjudicate eviction matters.
2. Validity of eviction notices issued by the Liquidator.
3. Whether the Liquidator can take possession of the property without filing a civil eviction suit.

Summary:

Jurisdiction of NCLT to Adjudicate Eviction Matters:
The primary issue is whether the National Company Law Tribunal (NCLT) has jurisdiction to entertain eviction matters under Section 60(5) of the Insolvency and Bankruptcy Code (IBC). The Appellant argued that NCLT has exclusive jurisdiction over matters involving the corporate debtor, citing the Supreme Court's interpretation in "Arcelor Mittal India Private Limited v Satish Kumar Gupta," which emphasized that NCLT alone has jurisdiction for applications and proceedings by or against a corporate debtor. The Respondent countered that the dispute is civil in nature and should be adjudicated by a civil court, referencing the "Embassy Property Developments Pvt Ltd v State of Karnataka and others" case, which delineated the limits of NCLT's jurisdiction. The Tribunal noted that NCLT's jurisdiction extends to matters arising out of or in relation to insolvency resolution or liquidation proceedings, as per Section 60(5)(c) of the IBC.

Validity of Eviction Notices Issued by the Liquidator:
The Appellant issued several eviction notices to the Respondent, who continued to occupy the premises despite the expiration of the Leave and License Agreement. The Respondent argued that the eviction notices were void ab initio as they did not comply with the contractual requirement of providing one month's notice to rectify any breach. The Tribunal found that the Respondent had been paying rent as per a mutual understanding, even after the agreement expired, and that the Appellant's notices did not adhere to the stipulated contractual terms.

Whether the Liquidator Can Take Possession of the Property Without Filing a Civil Eviction Suit:
The Appellant contended that requiring the Liquidator to file a civil eviction suit would unduly prolong the insolvency process, which is designed to be time-bound. The Tribunal referred to the NCLAT's decision in "Jhanvi Rajpal Automotive Pvt. Ltd. v R.P. of Rajpal Abhikaran Pvt. Ltd. & Anr.," where it was held that the Resolution Professional (RP) need not file a civil suit for eviction if the lease has expired. The Tribunal noted that this decision had been upheld by the Supreme Court. Consequently, the Tribunal concluded that the NCLT has the jurisdiction to direct the eviction of the Respondent without requiring the Liquidator to file a separate civil suit.

Conclusion:
The Tribunal set aside the impugned order dated 10.02.2021 by the Adjudicating Authority (NCLT, Ahmedabad Bench) and remanded the matter back to the Adjudicating Authority to pass a fresh order in accordance with the law. The Tribunal emphasized that the NCLT has jurisdiction over eviction matters involving the corporate debtor and that the Liquidator need not file a separate civil suit for eviction.

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