TaxTMI 
TaxTMI 
2020 (3) TMI 34
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....velopment Authority (hereinafter referred to as 'the MHADA') to execute a joint development agreement with the Corporate Debtor, i.e. Guru Ashish Construction Private Limited, and Goregaon Siddharth Nagar Sahakar Griha Nirman Sanstha Limited (a Society for persons who are displaced and who are to be rehoused in the project for joint development of land, ad- measuring about 40 acres), which envisaged re-development insofar as 672 tenements in Siddharth Nagar, Goregaon, Mumbai were concerned. ii. On 03.03.2008, the Maharashtra State Government granted its approval to the aforesaid Resolution. iii. On 10.04.2008, a Tripartite Joint Development Agreement (hereinafter referred to as the "Joint Development Agreement") was entered into between the Society representing persons occupying 672 tenements, MHADA and the Corporate Debtor. iv. On 25.03.2011, a Loan Agreement was entered into and executed between the Union Bank of India and the Corporate Debtor for a sum of Rs. 200 Crores. v. On 09.11.2011, a Deed of Modification was entered into between the three parties to the Joint Development Agreement, as after carrying out the survey of the land in questio....
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....eal to the NCLAT proved successful, whereby the NCLAT, by order dated 09.05.2018, allowed the appeal and allowed the entire 55 days so taken before the NCLT to be excluded. xi. On 03.07.2018, the Appellant filed an approved Resolution Plan before the NCLT, Mumbai by way of I.A. No.21433 of 2018. We are informed that this was within the extended period of 55 days so granted by the NCLAT. It may only be mentioned that the Resolution Plan was approved by 86.16% of the Committee of Creditors. Ultimately, the NCLAT, by the impugned order dated 14.12.2018, (after omitting to refer to the order dated 09.05.2018), stated that 270 days are over, as a result of which the entire discussion of Section 14(1)(d) would now become academic. However, it also decided: "14. On perusal of record, we find that pursuant to the 'Joint Development Agreement' the land of the 'Maharashtra Housing and Area Development Authority' was handed over to the 'Corporate Debtor' and 'except for development work' the 'Corporate Debtor' has not accrued any right over the land in question. The land belongs to the 'Maharashtra Housing and Area Development Authority' which has not formally transferred it....
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...., and not to legal possession, which is a separate concept in law. He cited a number of authorities to buttress his arguments. 3. Mr. Dushyant Dave, learned Senior Advocate appearing on behalf of MHADA, painstakingly took us through the various provisions of the Maharashtra Housing and Area Development Act, 1976 (hereinafter referred to as the "MHADA Act"). He relied, in particular, upon the various clauses in the preamble and then referred to Sections 4, 5, 37, 66 and 74 and relied strongly upon Sections 76 and 79 of the MHADA Act to argue that joint development schemes that the Authorities concerned enter into with the builders must first be with the previous approval of the Authority, and such schemes have to be executed under the supervision of the Authority. This being the case, according to him, there is no question of any possession or occupation being handed over and, as a result, Section 14(1)(d) of the Code would not apply. He also strongly relied upon a recent judgment by my brother S. Ravindra Bhat, J. in Municipal Corporation of Greater Mumbai (MCGM) vs. Abhilash Lal & Ors. (Civil Appeal No. 6350 of 2019), to buttress his proposition that Section 238 of the Code, wh....
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....nterest 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 (54 of 2002); (d) the recovery of any property by an owner or lessor where such property is occupied by or in the possession of the corporate debtor. (2) The supply of essential goods or services to the corporate debtor as may be specified shall not be terminated or suspended or interrupted during moratorium period. (3) The provisions of sub-section (1) shall not apply to- (a) such transaction as may be notified by the Central Government in consultation with any financial regulator; (b) a surety in a contract of guarantee to a corporate debtor. (4) The order of moratorium shall have effect from the date of such order till the completion of the corporate insolvency resolution process: Provided that where at any time during the corporate insolvency resolution process period, if the Adjudicating Authority approves the resolution plan under sub-section (1) of section 31 or passes an order for liquidation of corporate debtor under section....
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....e debtor held under trust or under contractual arrangements including bailment; (b) assets of any Indian or foreign subsidiary of the corporate debtor; and (c) such other assets as may be notified by the Central Government in consultation with any financial sector regulator." Section 31 which indicates the period of moratorium is also important and is set out as follows: "31. Approval of resolution plan. (1) If the Adjudicating Authority is satisfied that the resolution plan as approved by the committee of creditors under sub-section (4) of section 30 meets the requirements as referred to in sub-section (2) of section 30, it shall by order approve the resolution plan which shall be binding on the corporate debtor and its employees, members, creditors, including the Central Government, any State Government or any local authority to whom a debt in respect of the payment of dues arising under any law for the time being in force, such as authorities to whom statutory dues are owed, guarantors and other stakeholders involved in the resolution plan: Provided that the Adjudicating Authority shall, before passing an order for approval of reso....
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....lti-lateral trading or clearing transactions; (c) personal assets of any shareholder or partner of a corporate debtor as the case may be provided such assets are not held on account of avoidance transactions that may be avoided under this Chapter; (d) assets of any Indian or foreign subsidiary of the corporate debtor; or (e) any other assets as may be specified by the Board, including assets which could be subject to set-off on account of mutual dealings between the corporate debtor and any creditor." 6. The Joint Development Agreement, in the present case, makes it clear that a license is granted to the developer (i.e. the Corporate Debtor) to enter upon the land, demolish the existing structures and to construct and erect new structures and allot tenements. This is done in the Joint Development Agreement as follows: "1.1.9 License Agreement shall mean and include an agreement by which a license will be granted in favour of the developer to enter upon the said land, to demolish the existing structures, to construct and erect new structures, to allot tenements in such constructed structures to the tenants and to do all other acts as are necess....
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....ted free of cost to MHADA; and (3) what is referred to as "free sale component" which the developers then sell and exploit to recover or recoup cost and make profit. It is wholly unnecessary for us to refer to any other clauses of the Joint Development Agreement. It is also not necessary for the purpose of this case to state as to whether an interest in property is or is not created by the said Joint Development Agreement. 7. A bare reading of Section 14(1)(d) of the Code would make it clear that it does not deal with any of the assets or legal right or beneficial interest in such assets of the corporate debtor. For this reason, any reference to Sections 18 and 36, as was made by the NCLT, becomes wholly unnecessary in deciding the scope of Section 14(1)(d), which stands on a separate footing. Under Section 14(1)(d) what is referred to is the "recovery of any property". The 'property' in this case consists of land, ad-measuring 47 acres, together with structures thereon that had to be demolished. 'Recovery' would necessarily go with what was parted by the corporate debtor, and for this one has to go to the next expression contained in the said sub-section. 8. One thing is cle....
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....ses of clause (b) shall be introduced or moved in the Legislature of a State without the previous sanction of the President." The expression "no Bill or amendment" was read distributively with the expression "shall be introduced or moved in the Legislature of a State", it being clear that a bill is "introduced" and an amendment "moved", in the following paragraphs: "13. The High Court, in this connection, relied on two earlier decisions of the same court in George v. State of Travancore-Cochin, AIR 1954 Tra-Co 34 and State v. Philipose Philip, AIR 1954 Tra-Co 257. In fact, the High Court, in the present case, expressed its decision in almost the same language as was contained in the case of George v. State. In the second case of State v. Philipose Philip, this aspect was not clearly discussed. The point, however, was considered in detail by a Full Bench of that High Court in Ulahannan Mathai v. State, AIR 1955 Tra- Co 82. The High Court interpreted the expression "No Bill or amendment shall be introduced or moved" in the proviso as requiring that the Bill should neither be introduced nor moved without the prior sanction of the President, and, since in the case of Act 5 ....
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....ture. There is no reference at any stage to a Bill being moved in a House. The language thus used in the Constitution clearly points to the interpretation that, even in the proviso to Article 304, the word "introduced" refers to the Bill, while the word "moved" refers to the amendment." 10. Likewise, in Kailash Nath Agarwal and Others v. Pradeshiya Industrial & Investment Corporation of U.P. Ltd. and Another (2003) 4 SCC 305, this Court referred to Section 22(1) of the Sick Industries Companies (Special Provisions) Amendment Act, 1994 and applied the aforesaid latin maxim to the words "suit" and "proceeding" as follows: "20. There is an apparent distinction between the expressions "proceeding" and "suit" used in Section 22(1). While it is true that two different words may be used in the same statute to convey the same meaning, that is the exception rather than the rule. The general rule is that when two different words are used by the same statute, prima facie one has to construe these different words as carrying different meanings. In Kanhaiyalal Vishindas Gidwani (1993) 2 SCC 144, this Court found that the words "subscribed" and "signed" had been used in the Represent....
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....matter of decision in a number of judgments in different contexts. Thus, in Industrial Supplies Pvt. Ltd. and Another vs. Union of India and Others (1980) 4 SCC 341, this Court was faced with the following question: "2. The appeals raise a question of far-reaching importance namely, whether a raising contractor of a coal mine is an owner within the meaning of subsection (1) of Section 4 of the Coking Coal Mines (Nationalisation) Act, 1972 (hereinafter referred to as the "Nationalisation Act"); and if so, whether the fixed assets like machinery, plants, equipment and other properties installed or brought in by such a raising contractor vest in the Central Government. They also give rise to a subsidiary question, namely, whether subsidy receivable from the erstwhile Coal Board established under Section 4 of the Coal Mines (Conservation, Safety and Development) Act, 1952 up to the specified date, from a fund known as Conservation and Safety Fund, by such raising contractor prior to the appointed day, can be realised by the Central Government by virtue of their powers under sub-section (3) of Section 22 of the Nationalisation Act, to the exclusion of all other persons includin....
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.... set out in paragraph 19 of the judgment as follows: "(v) if the tenant ceases to occupy the building continuously for six months without reasonable cause." Coming to the word "occupy" in the said section, this Court then held: "21. The word "occupy" used in Section 11(4)(v) is not synonymous with legal possession in technical sense. It means actual possession of the tenanted building or use thereof for the purpose for which it is let out. If the building is let out for residential purpose and the tenant is shown to be continuously absent from the building for six months, the court may presume that he has ceased to occupy the building or abandoned it. If the building is let out for business or commercial purpose, complete cessation of the business/commercial activity may give rise to a presumption that the tenant has ceased to occupy the premises. In either case, legal possession of the building by the tenant will, by itself, be not sufficient for refusing an order of eviction unless the tenant proves that there was a reasonable cause for his having ceased to occupy the building. xxx xxx xxx 25. The Court highlighted the distinction between th....
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....e the availability of reasonable cause for ceasing to occupy the tenancy premises." xxx xxx xxx 29. In Ananthasubramania Iyer v. Sarada Amma 1978 KLT 338, the learned Single Judge of the Kerala High Court held: (KLT pp. 339-40, para 3) The physical absence of the tenant from the building for more than six months would raise a presumption that he had ceased to occupy the building and that he had abandoned it and that it was for the tenant to dislodge the presumption and establish that he had the intention to continue to occupy the tenanted premises. 30. The word "occupy" appearing in Section 11(4)(v) of the 1965 Act has been interpreted by the Kerala High Court in a large number of cases. In Mathai Antony v. Abraham (2004) 3 KLT 169, the Division Bench of the High Court referred to several judgments including the one of this Court in Ram Dass v. Davinder (2004) 3 SCC 684 and observed: "4. ... The word 'occupy' occurring in Section 11(4)(v) has got different meaning in different context. The meaning of the word 'occupy' in the context of Section 11(4)(v) has to be understood in the light of the object and purpose of the Rent Control Act in....
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....Act is concerned when pertains to tenant, that is, possession with user." 14. A Full Bench judgment of the Punjab and Haryana High Court reported in Ude Bhan and Others vs. Kapoor Chand and Others AIR 1967 P&H 53 (FB) is also instructive. Paragraph 1 of the judgment speaks of three questions referred to the Full Bench. We are directly concerned with question 2 which is set out by us herein below: "(2) If any building attached to the main residential house belonging to and occupied by a non- agriculturist judgment-debtor is let out to a tenant, will that portion be considered to be in his occupation within the meaning of the above provision?" In answering this question, the Full Bench went into various authorities and dictionaries as to what the expression "occupied" would mean, as follows: "20. The other term about which considerable argument has been addressed to the Bench is "occupied by him" and it has even been suggested that the property which is let by the owner to a tenant, though not in the former's actual occupation, is in his constructive occupation just as it may be said that he is possessing it though indirectly through his tenant. Reference ....
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....r to all of them. On behalf of the judgmentdebtor reference has been made to the interpretation of the terms "occupation" and "occupy" in clause (3) of the Mysore House Rent and Accommodation Control Order in Ratilal Bros. v. The Government of Mysore and another, AIR 1951 Mysore 66 and section 11(3) of the Bihar Buildings (Lease, Rent and Eviction) Control Act, 1947, in Balmukand Khatry v. Hari Narain and others, AIR 1949 Patna 31 and on behalf of the decree-holders reliance was placed on the definition of similar terms in section 7(3) of the Madras Buildings (Lease and Rent Control) Act,1946, as given in Dr.Mohammad Ibrahim v. Syed Ahmed Khan and another, AIR 1950 Mad 556 and in sub- section (5) of section 15 of the East Punjab Urban Rent Restriction Act, 1949, as made in Shakuntla Bawa v. Ram Parkash and others, ILR (1963) 1 Punj 827. These interpretations depend on the particular context in which the terms occur in the relevant statute but what has been observed in most of these cases is that the term "occupation" is of a wider import than the term possession and means something more than legal possession, which may be either actual or constructive. More helpful are some cases w....
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....relating to repairs and reconstruction of dilapidated buildings. Subject to the provisions of this Chapter, it shall be the duty of the Board - (a) to undertake and carry out structural repairs to buildings, in such order of priority as the Board, having regard to the exigencies of the case and availability of resources, considers necessary, without recovering any expenses thereof from the owners or occupiers of such buildings; (b) to provide temporary or alternative accommodation to the occupiers of any such building, when repairs thereto are undertaken, or a building collapses; (c) to undertake, from time to time, the work of ordinary and tenantable repairs in respect of all premises placed at the disposal of the Board; (d) to move the State Government to acquire old and dilapidated buildings and which are, in the opinion of the Board, beyond repairs; and to reconstruct or to get reconstructed new buildings thereon for the purpose of housing as many occupiers of those properties as possible, and for providing alternative accommodation to other affected occupiers; 79. Power of Board to undertake building repairs, building reconstruction....
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....tion 31(3) of the Code, to the date of admission of an insolvency petition up to the date that the Adjudicating Authority either allows a resolution plan to come into effect or states that the corporate debtor must go into the liquidation. For this temporary period, at least, all the things referred to under Section 14 must be strictly observed so that the corporate debtor may finally be put back on its feet albeit with a new management. 17. My learned brother S. Ravindra Bhat, J.'s judgment in Municipal Corporation of Greater Mumbai (supra), which has been strongly relied upon by Mr. Dave and Mr. Patil, dealt with an entirely different fact situation, as is clear from paragraphs 32 and 33 of the said judgment, which are set out herein below: "32. A cumulative reading of the stipulations reveals that the contract/agreement contemplates that the lease deed was to be executed after the completion of the project. The contract reveals that (a) the project period was for 60 months starting from the date excluding the monsoon period; (b) by Clauses 5 and 17, SevenHills could mortgage the property for securing advances from financial institutions for the construction of the pr....