TaxTMI 
TaxTMI 
2019 (10) TMI 1355
X X X X Extracts X X X X
X X X X Extracts X X X X
....n repelled by Hon'ble the Supreme Court in the judgment rendered in the case of Pioneer Urban Land and Infrastructure Limited and Another v. Union of India & Ors. (Writ Petition (Civil) No. 43 of 2019, decided on 09.08.2019). Therefore, no doubt is left that the petitioners are Financial Creditors. 3. The Respondent company-the Corporate Debtor, MSA Developers Private Limited (CIN U70200DL2013PTC252698) was incorporated on 24.05.2013 under the provisions of the Companies Act, 1956. The registered office of the Respondent-Corporate Debtor is situated at 11/37, Ground Floor, Old Rajinder Nagar, New Delhi-110060. Its authorized share capital of Rs. 25,00,000/- and paid up share capital of Rs. 1,00,000/- which is based on the details given in master data obtained from the official website of Registrar of Companies (Annexure- A-4). Since the registered office of the respondent corporate debtor is in Delhi, this Tribunal being Adjudicating Authority has territorial jurisdiction in respect of respondent corporate debtor as per the provisions of sub-section (1) of Section 60 of the Code. 4. The 'Financial Creditors'-Petitioners have proposed the name of Resolution Professiona....
X X X X Extracts X X X X
X X X X Extracts X X X X
....3 of the Annexure-'D' namely Special Scheme attached with the allotment letters/builder buyer agreements, the petitioners were offered a special 'buy back' scheme whereby they had an option to sell the flats back to the Corporate Debtor after a period of 42 months from the date of execution of the allotment letters/builder buyer agreements. The relevant clause 3 incorporated in the said allotment letters/builder buyer agreements reads thus: "3. The allottee can either retain the flat or opt for the buyback scheme from the developer with Rs. 46,46,250/-(BSP Rs. 2950*1575 sq.ft) after 42 months or possession whichever is earlier." 8. However even after expiry of sufficient long-time possession of the said flats have not been handed over to the petitioners. The petitioner No. 3 has also filed a complaint against the Respondent Company with Economic Offences Wing, Delhi Police (Annexure A-10). The petitioners have landed before Adjudicating Authority-NCLT. Copies of statement of bank accounts of some of the petitioners where deposits are made or credits received normally by them have been placed on record (Annexure A-8). 9. The Petitioners have also attached other d....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 19(a) of the allotment letters/builder buyer agreements the Corporate Debtor had proposed to handover the possession of the flats within thirty six months from the date of starting of excavation/signing of agreement with grace period of six months. It is further postulated by clause 19(c) of the allotment letters/builder buyer agreements that in case the Corporate Debtor is not able to handover the possession within the time as stipulated in the aforesaid allotment letters/builder buyer agreements than the Financial Creditors-allottees are entitled to payment of compensation for delay @ Rs. 5/- per square feet per month of the super area. As per clause 3 of the Annexure-'D' namely Special Scheme attached with the allotment letters/builder buyer agreements, the petitioners were offered a special 'buy back' scheme whereby they had an option to sell the flats back to the Corporate Debtor after a period of 42 months from the date of execution of the allotment letters/builder buyer agreements whichever is earlier. 13. It is not disputed that the allotment letters/builder buyer agreements were signed and executed between the parties. True copy of statement of bank accou....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ommercial effect of a borrowing. The explanation has clarified that any amount raised from an allottee under a 'real estate project' was to be considered as an amount having the commercial effect of a borrowing and the expression 'allottee' and the 'real estate project' are to have the meanings respectively assigned to them in clauses (d) and (zn) of Section 2 of the Real Estate (Regulation and Development) Act, 2016. It is the aforesaid provision which was subject matter of challenge before Hon'ble the Supreme Court in a bunch of petitions. In the lead case titled as Pioneer Urban Land and Infrastructure Limited (supra) the conclusion of detailed discussion has been recorded in para 86 by Hon'ble the Supreme Court which reads as under:-. "Conclusion i. The Amendment Act to the Code does not infringe Articles 14, 19(1)(g) read with Article 19(6), or 300-A of the Constitution of India. ii. The RERA is to be read harmoniously with the Code, as amended by the Amendment Act. It is only in the event of conflict that the Code will prevail over the RERA. Remedies that are given to allottees of flats/apartments are therefore concurrent remedies, such a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n behalf of the Corporate Debtor also do not warrant any serious consideration. It is already observed that the object of the Corporate Insolvency Resolution Process is to rescue a fund starving body corporate from the financial stress as is discussed in para 15 of the order and it is not understood as to how the Corporate Insolvency Resolution Process could be deferred merely because it was agreed between the parties that in case of default on the part of the Respondent, the Petitioner would take over the possession of the property, which has been allotted as collateral security to the Petitioner and are of a very high value. It is not the property which is at the base of the Code, 2016. It is cash liquidity which is the basis for triggering the Corporate Insolvency Resolution Process. Such like factors cannot obstruct the admission of the petition. 18. Another objection raised by the Corporate Debtor is that the petitioners are speculative buyers. The basis of the objection is that they have multiple properties and have invested in the project to tap the momentum of real estate market and one of them is in real estate business being President of the Association. There is nothing....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... dates have been clearly stated in part IV along with all the minute details. There is overwhelming evidence to prove default. The name of the resolution professional has also been specified. 22. We may now examine the provisions of Section 7 (2) and Section 7 (5) of IBC which read as under:- "Initiation of corporate insolvency resolution process by financial creditor. 7(1) .................. 7 (2) The financial creditor shall make an application under sub-section (1) in such form and manner and accompanied with such fee as may be prescribed. 7(3) .................. 7(4) .................. 7 (5) Where the Adjudicating Authority is satisfied that- (a) a default has occurred and the application under sub-section (2) is complete, and there is no disciplinary proceedings pending against the proposed resolution professional, it may, by order, admit such application; or (b) ..................' 23. A conjoint reading of the aforesaid provision would show that form and manner of the application has to be the one as prescribed. It is evident from the record that the application has been filed on the proforma prescribed under Rule 4 (2) of the Insolvency and Bankruptcy ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... specified is not to be terminated or suspended or interrupted during the moratorium period. These would include supply of water, electricity and similar other services or supplies as provided by Regulation 32 of IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. 28. The Interim Resolution Professional shall perform all his functions religiously and strictly which are contemplated, interalia, by Sections 15, 17, 18, 19, 20 & 21 of the Code. He must follow best practices and principles of fairness which are to apply at various stages of Corporate Insolvency Resolution Process. His conduct should be above board & independent; and he should work with utmost integrity and honesty. It is further made clear that all the personnel connected with the Corporate Debtor, erstwhile directors, promoters or any other person associated with the Management of the Corporate Debtor are under legal obligation under Section 19 of the Code to extend every assistance and cooperation to the Interim Resolution Professional as may be required by him in managing the affairs of the Corporate Debtor. In case there is any violation committed by the ex-management or any tainted/illeg....