TaxTMI 
TaxTMI 
2019 (6) TMI 1421
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.... thus being disposed of by this common order. 2. This Tribunal while dealing with M.A. (IB) No. 585 and M.A.(IB) No. 586/KB/2019 on 7th May, 2019 passed the following orders:- "Misc. A. No. 585/KB/2019 as well as Misc. A. No. 586/KB/2019 has come up for consideration on this day, which has been filed individually challenging the order of sale of Nicco House (in Liquidation). Heard the Ld. Liquidator and the applicants who appeared in person. Upon hearing the argument, perusal of the records, prima facie I am satisfied that the applicants have established an arguable case. The Liquidator has submitted that agreement for sale was already executed and conveyance deed is to be executed within four months upon fulfilment of terms and conditions in the agreement by the buyer. Accordingly, the Liquidator is hereby directed not to proceed with the execution of Conveyance Deed until the disposal of the application. In the meanwhile, Liquidator is directed to file reply affidavit in Misc. A. Nos. 585 & 586/KB/2019 within 7 days by serving copy of the reply affidavit to the respective applicants. Applicants are directed to file rejoinder, if any, within 7 days of receipt of the re....
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....rected to file affidavit of service of notice to the liquidator". 4. In the backdrop of the aforesaid Two orders passed by this Tribunal arguments have been heard today on behalf of all the applicants, Liquidator and the proposed buyer and these applications are being dealt with and disposed of by a common order. The Applicant in M.A. (IB) No. 585/KB/2019 submits that she is one of the Partners of M/S. Supreme Legal Services & Tax Consultants and has a Law Chamber in the premises in question for last more than a decade and is occupying a carpet area of about 214 sq.ft. with other common facilities. The specific objection of the Applicant in this application is the manner in which a portion of the 2nd Floor of Nicco House has been sold to another co-tenant and Advocate, without any public notice or prior information or without giving similar offer to the applicant or other tenant on the same floor. 5. It is submitted that the agreement to sale has been executed between the Respondent i.e. the Liquidator of the Corporate Debtor and M/S. Narnolia Financial Advisors Limited. 6. It is further submitted by the Applicant that it is not clarified as to how M/S. Narnolia Financial ....
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....e petition that the sale was made to different persons in several lots through the Broker so called by the Purchasers representative, namely, M/S. Narnolia Financial Advisor Limited. When the Petitioner contacted the Liquidator he was advised to contact M/S. Narnolia Financial Advisor Limited for further correspondence and even making all sorts of payment directly to them. But the said M/S. Narnolia Financial Advisor Limited did not give any response to such letter. 13. In Inv. A. (IB) No. 604/KB/2019, the Applicant D&l Taxcon Services Private Limited, a tenant in respect of office space in Nicco House has filed this application. This applicant has filed this application as Operational Creditor for settling their claim which is pending. The Applicant No. 2 Tapas Dutta is the Director of Applicant No. 1 and is a practicing Advocate having a chamber in the premises at Nicco House. 14.1t is submitted in this application that the entire G+7 storied building is an unauthorized construction and he made a complaint vide letter dated 30th November, 2015 to the Kolkata Municipal Corporation for initiating demolition proceedings in respect of the said building. The applicant further st....
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....cant. 19.1t is submitted that the Liquidator colluded and conspired with the auction purchaser in order to defraud the trust and to defeat the object that the liquidation proceedings of the corporate applicant. 20. The applicant, like other two applicants, sought leave to intervene in the Liquidation proceedings of the Corporate Applicant and sought stay of all proceedings in the liquidation proceedings like sale of Nicco House. The applicant further prays that the agreement for sale, if any be adjudged void and injunction restraining the Liquidator, his men, agents, servants and assignees from taking any step or further step or acting on the basis of the agreement for sale dated 15th March, 2019 or any other agreement or conveyance that may have been entered into in respect of the 2 nd floor of the said building, including the letter dated 10.04.2019 and 22.04.2019 issued by the Liquidator. The applicant further prays for restraining the Liquidator from holding himself out as the Liquidator or continuing to act as the Liquidator or intermeddling with the assets and properties of the corporate debtor in any manner whatsoever. 21. The Applicant further prays status-quo orde....
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....uidation Process Regulations, 2016 provides that " (1) The Liquidator shall ordinarily sell the assets of the Corporate Debtor through an auction in the manner specified in Schedule l, Provided that the liquidator shall not sell the assets, without prior permission of the Adjudicating Authority, by way of private sale to - (a) a related party of the corporate debtor; (b) his related party; or (c) any professional appointed by him; and (3) The Liquidator shall not proceed with the sale of an asset if he has reasons to believe that there is any collusion between the buyers, or the corporate debtor's related parties and buyers, or the creditors and the buyer, and shall submit a report to the Adjudicating Authority in this regard, seeking appropriate orders against the colluding parties. Regulation 34 provides that - (1) On framing the liquidation estate under section 36, the liquidator shall prepare an asset memorandum in accordance with this Regulation within seventy-five days from the liquidation commencement date. (2) The asset memorandum shall provide the following details in respect of the assets....
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....nsortium of Purchasers pursuant to which the agreement for sale was executed between the Liquidator and representative of Consortium and in confirmation thereof each of the Purchasers signed the confirmation and statement which formed part of the affidavit. The sale of the property in no way affects the rights of the three applicants who are stated to be tenants and/occupants of their respective portions in the said Lot 'A'. It is important to notice here that the applicant did not approach either the Liquidator or this Tribunal when the expressions of interest were published by the Liquidator on 7 (Seven) earlier occasions in the past on different dates, prior to the last expression of interest was published on 10th January, 2019, which finally culminate into the sale of the Lot 'A'. 30. The Liquidator has complied with all the requirements of the provisions of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 whereby he had to prepare an asset memorandum and also to obtain valuation at least from two Valuers and by using an average thereof he had to decide the reserve price. The Liquidator has filed the 5th Progress Report whi....
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....points urged on the side of the applicants/objectors though dealt with by my brother in brief, seem to be dealt with in detail. 2. At the outset, I am fully subscribing to the views of my learned brother that none of the applicants have succeeded in pointing out any irregularity or illegality in the process of sale proceedings initiated by the Liquidator. 3. One of the main points urged by the objectors/applicants is that the Liquidator obtained valuation report with some extraneous consideration and that the method of valuation is not transparent and there is no basis for arriving at such calculation. To strengthen the said submissions here in this case, no material has brought to our notice. 4. At the time of hearing, the Liquidator was directed to submit the valuation reports of the two Valuers who were appointed by him as per Regulation 35 of IBBI (Liquidation Process) Regulation 2016. As per Regulation 35 (1) of IBBI (Liquidation Process) Regulation 2016, the Liquidator shall appoint two registered valuers to evaluate the assets as required under Regulation 34. One Mr. Sudip Kumar Sarkar, Chartered Engineer by Profession who is a Government and IBBI Registered Valuer,....
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....e lowest price than that of a price prevalent in the locality. On the other hand, from a bare scrutiny of the valuation reports, it is understood that both the Valuers considered the locality wherein the building is situated referred to the certain conveyance deeds, referred to the market value declared by the Govt. of West Bengal office, various real estate website and arrived at the market rate adopting well known parameters without any cloud surrounding valuation. It is upon the said reasons I find no merits in the submissions of the Ld. Counsel/ applicants as to the valuation of the assets of the corporate debtor. The valuations were seen done in accordance with the provisions of the Code and the Regulations. 9. One more point urged by the Ld. Counsel/Applicants is that the liquidator reduced the reserve price beyond permissible limit and therefore the sale proceeding is irregular and in violation of the Regulations. To substantiate the said contention also here in this case, no data or evidence has been made available on the side of the applicants. 10. The Ld. Liquidator has filed the progress reports as per the provisions of the Code and submitted a list of dates as to ....
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....rding to the Ld.Sr.Counsel appearing for the Liquidator it was done so as to get maximum realisation from the sale of assets in the best interest of the creditors. According to him none of the creditors objected the partitioning the assets into two lots. On the other hand the creditors who are parties to the Monitoring Committee approved all the steps for the sale of assets by the Liquidator for enabling him to get buyers of the assets of the corporate debtor. Argued by the Ld. Sr. Counsel for the liquidator. The steps taken by reducing the upset price, from the available evidence is found legal and proper and in accordance with the power hold by the liquidator as per regulation 33 and 34. As per Schedule I (1) (4) a liquidator if failed in his attempt to obtain bidders for the price he notified in the EOI and auction fails, he can reduce the reserve price up to 75% of such value to conduct the subsequent auction. So reduction of reserve price is with in his power and he needs not to get any prior permission from the Adjudicating Authority for reduction. So the points urged in regards to reduction of reserve price is also found devoid of any merits. 15.At this juncture the Ld. S....