AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2019 (9) TMI 26
X X X X Extracts X X X X
X X X X Extracts X X X X
....vate Limited was incorporated on 11.09.2009, having CIN U70109DL2009PTC194189 and its registered office is situated at UGF 10- 1 1, Pragati Tower, Rajendra Place, New Delhi- 110008. The authorised share capital of the company is Rs. 66,00,000/- (Rupees Sixty-Six Lakhs only) and the Paid-up share capital is Rs. 66,00,000/- (Rupees Sixty-Six Lakh), respectively. 3. As per averments made in the application, the financial creditors entered into a Flat Buyers Agreement dated 29.03.2012 with the corporate debtor and had paid almost 90% of the purchase value of the flats amounting to Rs. 4,18,23,303/- in respect of the Ridge Residency housing project at Sector - 135, Noida, Uttar Pradesh, during 2011-13. According to the flat buyers agreement, the Applicants were supposed to make all the regular payments, towards the apartment allotted to them, as per the construction linked plan and the Corporate Debtor was obliged to deliver possession within the period of 30 months with a further grace period of 120 days, failing which the Corporate Debtor was to pay compensation, @Rs. 5/- per sq. ft. per month for the area of each unit. 4. It is submitted by the Financial Creditors that as per the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he amount paid by the Allottee. 9. The Financial Creditors sought the compensation from the respondent on the basis of the clause 7.2 of the allotment letter, however the applicant has failed to point out that the payment of compensation for delay in possession is subject to various other conditions including the conditions provided in clause itself. As per the same clause the period of completion was subjected to various conditions such as timely payment by the applicant, force majeure conditions, change in law, availability of the raw material, the circumstances beyond the reasonable control of the respondent. 10. The Applicants has filed rejoinder controverting the averments made in the reply and reiterating the one made in the application. Reliance has been placed on the following observations of the Hon'ble Supreme Court in "Innovative Industries Ltd v. ICICI Bank" (2018) 1 SCC 507, which are follows: "28. When it comes to a financial creditor triggering the process, section 7 becomes relevant. Under the Explanation to Section 7 (1), a default is in respect of a financial debt owed to any financial creditor of the corporate debtor - it need not be a debt owed to the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ssession of the said residential units, even though as per the builder buyer agreement the possession was to be delivered within a time of span of 30 months from the date of agreement with a further grace period of 120 days. Thereby admitting the existence of a 'financial debt' and a 'default'. 12. Further, Section 88 of RERA provides that RERA shall be in addition to, and not in derogation of, the provisions of any other law for the time being in force. Further, Section 89 of RERA provides that the provisions of RERA shall have effect, notwithstanding anything inconsistent contained in any other law for the time being in force. Likewise both statues operates in different fields and in any case section 238 has a non-obstante clause which would prevail over the provision of RERA, Section 238 of the IBC provides that the provisions of the IBC are to have effect, notwithstanding, anything inconsistent therewith contained in any other law for the time being in force or any instrument having effect by virtue of any such law. The admission of an application under the IBC results in the commencement of the corporate insolvency resolution process while a complaint under R....
X X X X Extracts X X X X
X X X X Extracts X X X X
....includes the person who subsequently acquires the said allotment through sale, transfer or otherwise but does not include a person to whom such plot, apartment or building, as the case may be, is given on rent" 15. The said period having elapsed and the Corporate Debtor having failed to deliver possession of the said flats, there is a clear default committed by the Corporate debtor which is correct position taken by the financial creditor to put in statutory slot and we may refer to Section 3(12) of the Code and the same is reproduced hereunder: "(12) "default" means non-payment of debt when whole or any part or instalment of the amount of debt has become due and payable and is not repaid by the debtor or the corporate debtor, as the case may be; 16. The Financial Creditors have rightly argued that the period of default has commenced from the date when the Corporate Debtor was required to deliver possession of the respective units. In the present case, the flat buyer agreements in respect of all the applicants was executed between 2011-13. Accordingly, as per the Clause 7.1 of the agreement, the Corporate Debtor was required to deliver possession of the respective units late....
X X X X Extracts X X X X
X X X X Extracts X X X X
....iple of law that a non-obstante clause has effect only in case of a conflict between two statutes. It is submitted that RERA and IBC work in two different fields, while the former has been enacted with a view to regulate and promote the real estate sector while ensuring the protection of consumer interest; the latter seeks to consolidate the law relating to insolvency and bankruptcy and ensure resolution of insolvency of corporate persons, firms and individuals in a time bound manner. Thus, there is no question of a conflict between the two enactments and both will have an overriding effect in the fields exclusively assigned to them. Moreover, RERA was notified on 1st May, 2016 and IBC was notified later on different dates commencing from 05.08.2016. The provisions of Section 238 were enforced with effect from 1.12.2016. It is well settled that the later statues would override the earlier one on account of its overriding provisions as the law maker are supposed to have knowledge of all existing laws. We are also not impressed by the reliance placed by the corporate debtor on the judgment of the Hon'ble NCLAT in Krishna Enterprises V. Gammon India Pvt Ltd. in Company Appeal No....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nal direct that Interim Insolvency Resolution Professional shall immediately make public announcement with regard to admission of this application under Section 7 of the Code. We also declare moratorium in terms of Section 14 of the Code. A necessary consequence of the moratorium flows from the provisions of Section 14 (l) (a), (b), (c) & (d) and thus the following prohibitions are imposed which must be followed by all and sundry: a) the institution of suits or continuation of pending suits or proceedings against the corporate debtor including execution of any judgment, decree or order in any court of law, tribunal, arbitration panel or other authority; b) transferring, encumbering, alienating or disposing of by the corporate debtor any of its assets or any legal right or beneficial interest therein; c) any action to foreclose, recover or enforce any security interest created by the corporate debtor in respect of its property including any action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002; d) the recovery of any property by an owner or lessor where such property is occupied by or in the possession of th....