2023 (10) TMI 607 - AT - Companies Law

Tribunal quashes Authority's order, remits for reconsideration, emphasizing property rights, Supreme Court order, Indian Easement Act, and due process.

The Tribunal allowed the appeal, quashed the Adjudicating Authority's order, and remitted the matter back for reconsideration, emphasizing the need for a ... Principles of natural justice - opportunity of hearing not provided to the Appellant - non-speaking order - Appellant was restrained from disturbing the possession of the Respondent No.1 - HELD THAT:- Basis the appeal and also the written and oral submissions of Appellant and Respondents, it emerges that Apparently the appellant was not given any opportunity to file reply and in the very first hearing interim orders were issued on 04.07.2023. The impugned judgment and order passed by the Adjudicating Authority is quashed and set aside. The matter is remitted back to the Adjudicating Authority to look into all the aspects before passing any order in accordance with law - Appeal allowed. Issues Involved:1. Whether the Respondent No.1 has the right to possess and continue business operations in the 10,000 sq. ft. demarcated property.2. Whether the Adjudicating Authority's order dated 04.07.2023 was in contradiction to the Supreme Court's order dated 14.03.2023.3. Whether the Adjudicating Authority could pass an order considering provisions of the Indian Easement Act, 1882.4. Whether the Appellant was given an opportunity to file a reply before the interim order was passed.Summary:Issue 1: Right to Possess and Continue Business OperationsThe Supreme Court in its judgment dated 14.03.2023 recognized Respondent No.1 (M/s Victory Iron Works Ltd.) as a licensee for the demarcated area of 10,000 sq. ft. out of a total land of 10.19 acres, stating, 'A license does not create any interest in the immovable property.' The impugned order of 04.07.2023 by the Adjudicating Authority, which stated, 'recognizing the applicants' right to possess and continue business operation in the 10000 sq.ft. of demarcated property,' was found to give an erroneous impression of possession instead of merely being a licensee.Issue 2: Contradiction to Supreme Court's OrderThe Appellant claimed that the Adjudicating Authority's order allowing Respondent No.1 access to the property contradicted the Supreme Court's order dated 14.03.2023. The Supreme Court had affirmed the Appellant's right to take custody and control of the land, recognizing a 'bundle of rights and interests' in favor of the Corporate Debtor, which 'partake the character and shade of ownership rights.'Issue 3: Consideration of Indian Easement Act, 1882Respondent No.1 invoked Section 13(e) of the Indian Easement Act, 1882, claiming necessary easement for access to the 10,000 sq. ft. land. This issue was raised for the first time in IA (IB) No. 1007/KB/2023. The Tribunal noted that there was no mention of the Indian Easement Act, 1882, in any previous fora, indicating the need for proper examination of this claim.Issue 4: Opportunity to File ReplyThe Appellant argued that they were not given an opportunity to file a reply before the Adjudicating Authority passed the interim order on 04.07.2023. The Tribunal observed that the interim orders were issued in the very first hearing without affording the Appellant an opportunity to respond.Conclusion:The Tribunal allowed the appeal, quashed, and set aside the Adjudicating Authority's order dated 04.07.2023. The matter was remitted back to the Adjudicating Authority to consider all aspects before passing any order in accordance with the law.