TaxTMI 
TaxTMI 
2019 (10) TMI 454
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....s of rent. 2. Brief facts of the case, as mentioned in the Company Petition, which are relevant to the issue in question, are as follows: (1) M/s. Pleasant Valley Development Private Limited ('Petitioner/ Operational Creditor') was incorporated under the Companies Act, 1956, bearing CIN No.U45201KA1993PTC014685 is residing at 102, Embassy Palace, Cunningham Road, Bangalore - 560 052. (2) M/s. Spaine Hospitality Private Limited ('Respondent/Corporate Debtor') was incorporated on 14.03.2017, bearing CIN NO.U74999KA2017PTC101344. The Paid-up Capital of the Company is Rs. 10,00,000/- (Rupees Ten Lakhs Only). (3) It is stated that the Petitioner is the owner of a commercial building situated at No.30, Ground Floor, Church Street, Civil Station, Bangalore (the "Scheduled Premises"). At the request of M/s. Deccan International by seeking lease of premises to run its business, the Petitioner by agreeing the same, executed a Lease Deed dated 10.12.2015, and it was also registered as Document No.4269/2016-17 in the Office of the Sub-Registrar, Shivaji Nagar. Subsequently, Amendment to Deed of Lease dated on 5th April, 2017 was made to original Lease Deed dated 1....
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....itioner herein. iii. M/s. New Deccan International has also instructed that pursuant to the Lease Deed, M/s. New Deccan International has invested/incurred nearly a sum of Rs. 3 (Three) crores rupees in developing the leased premises which includes interior works i.e., Centralized AC, painting, civil work, furniture, working wooden work, name, signage etc. iv. M/s. New Deccan International has also instructed that they approached the statutory Body to obtain trade license for carrying commercial business in the leased premises and it came to the knowledge of them that the Building in which the premises is leased has been construed by the Petitioner without obtaining necessary license/permission/ sanction from the Bruhat Bengaluru Mahanagara Palike and the said building has been construed illegally. Further, the Petitioner has not obtained Occupancy Certificate from the Bruhat Bengaluru Mahanagara Palike. v. It is also stated that they have approached the Petitioner and informed the aforesaid factual aspect and then Petitioner assured that they shall get all the requisite permission and Occupancy Certificate from the BBMP so as to enable them I to carry th....
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....rar, Shivajinagar ('the Leased Premises') for running a restaurant by New Deccan International. iii. Subsequently, the Petitioner entered into an amended Lease Deed dated 05.04.2017 registered as Document No.80/17-18 in the offices of the Sub-Registrar, Shivajinagar by virtue of which M/s. New Deccan International assigned its rights under the Lease Deed in favour of the Corporate Debtor herein. The Corporate Debtor agreed to take the Leased Premises for running the restaurant purely based on the representations and warranties made by the Petitioner as it had obtained all necessary sanctions and approvals for the Building including the Leased Premises and confirmed that the building was fit for commercial use. iv. After taking the Leased Premises, the Corporate Debtor invested substantial amounts towards interiors required for running the restaurant. In the meantime, the Corporate Debtor also applied for requisite licenses from the statutory authorities for commencement of its operations and during that process, Corporate Debtor found out that Petitioner has not obtained the sanction plan for construction of the third floor and the terrace of the Building and cons....
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....o initiate appropriate proceedings for damages and breach of contract. viii. Therefore, the Respondent was called upon Petitioner to unconditionally withdraw the Demand Notice dated 25.10.2018, and to forthwith furnish to the Corporate Debtor: (1) copy of the sanction plan from BBMP' (2) copy of the Occupancy Certificate issued by BBMP; (3) Certificate/ approval from the fire department; (4) License issued by the Department of Electrical Inspectorate in respect to operation of Lifts in the building; within a period of 15 days from receipt of this notice, failing which they have threatened to take action. 3. Heard Shri S. Guru Prasanna, learned Counsel for the Petitioner. We have carefully perused the pleadings of the party and the material documents and the extant provisions of the Code and the law on issue. 4. Learned Counsel for the Petitioner has again reiterated various averments made in the Company Petition and also pointed out various documents in support of the case and filed written gist of arguments dated 23.04.2019. Learned Counsel for the Petitioner has relied upon the following judgements in support his case. - * Sarla Tantia v. Nadia Health Care....
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....r the premise is Rs. 2,70,000/- to payable by the Lessee in advance on 10th Day of every month. 7. The Lessee in consideration of grant of Lease of Premises, agreed to deposit and maintain with the Lessor an Interest Free Refundable Security Deposit of Rs. 26,00,000/-(Rupees twenty six Lakhs Only), paid by the following manner: a. Rs. 5,00,004/-(Rupees Five Lakhs and Four only) paid by the way of Cheque bearing No.185974 dated 16.11.2015 drawn on Axis Bank Limited, Bengaluru, as token advance. b. Rs. 21,00,000/- (Rupees Twenty One Lakhs only) paid by way of Cheque bearing No. 185982, drawn on Axis Bank Limited, Bengaluru dated 10.11.2015. 8. The Deed has Termination clause Under clause (4)(ii) (b), which reads as under: (1) The Lease shall be entitled to terminate at any time the lease granted in this Deed upon thirty (30) days' notice, if the Lessor defaults in the performance of any of its obligations under this Deed and such default is not cured within thirty days after the receipt of a notice of default issued by the Lessee. However the lease cannot be terminated during the lock in period of 36 months. (2) The Lessee shall have the sole....
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....Deed the Lessor shall refund to the Lessee the IFRSD amount of Rs. 26,00,000/- refundable by the Lessor to the Lessee in accordance with the terms of this Deed, and simultaneously, the Lessee shall handover physical vacant possession of the Premises to the Lessor in good tenantable condition. 9. As stated supra, the Operational Creditor has earlier issued notice dated 02.08.2017 to M/s. New Deccan International as well as M/s. Spaine Hospitality Private Limited by demanding notice both are them to pay rent from 10.12.2015 to 09.12.2016 at the rate of Rs. 2,70,000/- per month 1st year commencing and the rent for the 2nd year commencing from 10.12.2016 to 09.12.2017 is Rs. 3,10,500/-every month totally due of Rs. 6,21,000/-. And the same was replied by the Corporate Debtor vide reply dated 28.08.2017 by pointing out that the assurance given by the Operational Creditor at the time of agreement with regard to the statement that the paid up was constructed as per the "Commercial Approved Plan and is permitted by the Competent Authority to be fit for use and occupation and is reserved/approved for commercial retail use" are false and contrary to facts. They have also stated they have ....
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....ificate and criminal proceedings too was initiated against the Petitioner for cheating, mischief etc and stated to be pending. 12. The Petitioner did not prove that it had complied with all the obligations cast upon it in the Lease Deed to claim rents on the premises in question. Moreover, the Petitioner has alternative remedy to initiate eviction and recovery proceedings by terminating the lease in question as mentioned in their legal notice, as referred to above. However, the Petitioner chose to invoke provisions of Code without substantiating that they are entitled to claim for the alleged rent accrued. They have also not stated as to how period of 30 days exemption of rent and the Advance of Rs. 26 Lakhs deposit were treated. The Petitioner has not produced any evidence to show that the lease premises were delivered to Lessee as per the terms and conditions mentioned in the Lease Deed in question. Moreover, the Petitioner failed to attend the defects as pointed out by the Respondent in their reply. 13. As stated supra, the main lease deed was executed by and between the Operational Creditor and M/s. New Deccan International. Therefore, the prime responsibility lies on M/s....