TaxTMI 
TaxTMI 
2021 (3) TMI 774
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....evant period shall form part of the IRP Costs in terms of the IBC; b) Permit and allow the Applicant to file its claims with the Respondent / Liquidator for payment of the monthly fees for the relevant period under the service agreements; c) Direct the Respondent / Liquidator to treat any claims of the Applicant relating to monthly fees for the relevant period under the service agreements as IRP Costs; d) Ad interim / interim reliefs in terms of the above. 2. This Bench by an order dated 20/06/2019, initiated the Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor on a petition under Section 7 of the Code filed by the Financial Creditor. The Respondent herein was appointed as the Resolution Professional (RP) of the Corporate Debtor. 3. The following are the submissions of the Applicant: a) The Applicant permitted the Corporate Debtor to use its premises at 301B, 302, 401 and 404 of Kaledonia, Sahar Road, Andheri (E), Mumbai, for office purpose on Leave and License basis pursuant to a Leave and License Agreement dated 24/02/2011 executed between the Applicant and the Corporate Debtor. Further an Amenities Agreement da....
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.... The Respondent failed to reply to this notice. d) On 05/01/2020, i.e. after the expiry of 31/12/2019 deadline, the Applicant issued another notice to the Respondent requiring him to confirm whether the licensed premises and related amenities were being used by the Respondent for the CIRP period. Relevant paras are extracted below: Dear Sir, Sub: Occupation of Office units, 301B, 302, 401 and 404 at Kaledonia, Ville Parle, Andheri Sahar Road, Andheri East, Mumbai (the licensed premises) Ref: (i) Leave and license agreement dated 24 February 2011 executed by Jet Airways (India) Limited (Jet Airways) and Mack Star Marketing Private Limited as amended and extended from time to time (the Leave and License Agreement); and (ii) agreement dated 24 February 2011 executed by Jet Airways and Mack Star Marketing Private Limited (Mack Star) in respect of certain amenities and facilities as amended and extended from time to time (the amenities agreement) We write on instructions from, and on behalf of our client, Mack Star, we refer to the Leave and License Agreement and Amenities Agreement (together, the Service Agreements). In thi....
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....tion 5(13)(c) of the Code explicitly includes the cost incurred by the Respondent to keep the Corporate Debtor as a going concern as part of CIRP costs. Respondent not only continued to accept the services of the Applicant without any demur but also ignored the Applicant's express request to vacate the licensed premises making it evident that the services availed during CIRP are essential for maintaining the Corporate Debtor as a going concern. 6. Despite the Applicant's express request to vacate the licensed premises, the Respondent kept a part of the licensed premises under lock and key. The Respondent's conduct evidences not only the unqualified acceptance of the services but also underscores the importance of the services to the Corporate Debtor during CIRP. Therefore, this cost should be included in the CIRP. By not doing so, Respondent is attempting to unjustly enrich the Corporate Debtor or its Creditors at the expense of the Applicant. 7. It is submitted that the Applicant had acted in a bona fide manner by providing services to the Respondent and therefore the Applicant ought not to be deprived of the legitimate consideration owed to it for the services. 8. It is ....
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....rity deposit. In case of failure to do so, the Corporate Debtor was entitled to continue the occupation of the licensed premises until the receipt of the entire security deposit without payment of any further licence fee during the period of occupation. 11. The Applicant on 30/04/2019 issued notice to the Corporate Debtor. In the notice the Applicant stated that despite being called upon to deposit the licence fee for the occupied premises in February, 2019, the Corporate Debtor failed to do so. The Applicant further called upon the Corporate Debtor to cure the breach of the agreement within 30 days thereof and invoked its right to terminate the agreement in case the breach was not cured within the period. The notice being in the nature of a notice for eviction, no further payments was to be made by the Corporate Debtor subsequent thereto. Clause 19.5 of the Leave and License Agreement provides that upon the Applicant issuing the eviction notice, and upon the Corporate Debtor failing to rectify default of non-payment within 30 days, the agreement would stand pre-determined or terminated without any further notice. The Corporate Debtor having failed to make the payment within the....
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....r to the Insolvency Commencement Date ("ICD") and the Security Deposit of INR 3,29,61,490 (Three Crore Twenty Nine Lakh Sixty One Thousand Four Hundred Ninety) has not been refunded to the Company. 5. The company is entitled to receive the refundable Security Deposit (without any deductions) post termination of the leave and license agreement and you are hereby requested to credit the same to the below mentioned bank account of the Company within 3 days of receipt of this notice. Bank Account Details: Bank Name: State Bank of India Account No.: 36035234455 IFSC Code: SBIN0004791 6. Failure to make the payment within 3 days from the date of this notice shall be deemed to be non-cooperation and an obstruction to the CIRP under Section 19(2) of the Code and liable to be reported to the Hon'ble National Company Law Appellate Tribunal ("NCLAT") for necessary directions, which may include fines, penalties and prosecution as well, the costs of which shall be solely borne by you. 7. Please also note that Indian law considers me as an officer of the court and any hindrance caused in the performance of my duties under the Code or....
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....equired the Corporate Debtor to cure the breach of agreement within 30 days and invoked right to terminate the agreement in case the breach was not cured within that period. Admittedly the breach was not cured by the Corporate Debtor. Hence the Leave and Licence agreement stood terminated within 30 days from the period of notice i.e. with effect from 31/05/2019. (b) Clause 21.3 of the Leave and License agreement is clear that if the Applicant did not refund the security deposit, the Corporate Debtor would be entitled to continue to occupy the premises until receipt of the entire security amount without payment of any further license fee during the period of occupation. In view of this the Respondent was not required to hand over the possession till the security deposit was refunded and also need not to pay any license fee for the premises from 1st June, 2019. (c) The submission of the counsel for the Applicant that the Respondent used the premises while keeping the Corporate Debtor as a going concern and is duty bound to protect the Corporate Debtor etc. does not have any relevance, in view of the fact that the agreement stood terminated on 31st May, 2019. The sub....