TaxTMI 
TaxTMI 
TaxTMI 
2022 (2) TMI 145
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.... Applicant sought the following reliefs: - (a) To pass an order directing the Respondents herein to handover the physical possession of the mortgaged leasehold land of the Corporate Debtor (both Express Lease & Implied Lease lands used by the Corporate Debtor) into the Liquidation Estate of the Corporate Debtor; (b) To pass an order directing the Applicant to add the mortgaged land (Express Lease-100.16 Ares & Implied Lease- 78.45 Ares) into the Liquidation Estate of the Corporate Debtor: The facts in brief are as under: - 2. The application for CIRP was filed by the Financial Creditor M/s. Union Bank of India under Section 7 of the IBC, 2016 and the same was admitted by the NCLT, Chennai Bench, vide its Order dated 20.03.2019 in IBA/240/2019 and the applicant was appointed as the Resolution Professional. 3. The Applicant submitted that he has issued the Public Announcement in Form B dated 12.02.2020 for invitation of claims from the stakeholders and filed the Asset Memorandum and Preliminary Report under Regulations 5 & 34 of IBBI (Liquidation Process) Regulation, 2016 and Regulation 5 & 13 of IBBI (Liquidation Process) Regulation, 2016 on 24.02.2020. Since there was no Res....
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....ately by the mortgage holders is not feasible, as the land cannot be sold without the building attached to it. In the light of the inseparable nature of the land and building, it will be in the best interests of the liquidation process to sell the entire set of assets, so as to realize better value for all the stakeholders interested therein. Currently the above said lease land is under possession of the Respondent Nos. 1 and 2 under SARFAESI Act. Considering this fact, the Applicant has filed this application against the Respondents seeking directions to surrender the possession of the land into the liquidation estate, so as to ensure better realizable value for the entire asset to the stakeholders. It is also stated that once the lease is given for 99 years, it will be treated like permanent lease and all the usage rights were transferred to the Corporate Debtor. Hence no prejudice will be caused if this application is allowed. Even if the sale as a going concern fails, the Applicant has to sell the land and building together through E-Auction sale or as per the Act as the land and building cannot be sold separately being the building is constructed above the mortgaged land. 6. ....
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.... surrender the properties to the Liquidation Estate. They have further stated that the owners of the property (personal guarantors) are the necessary parties to this application, particularly when seeking prayers against their property. Hence the present application is bad for non-joinder of necessary parties. 10. The 2nd Respondent further stated that present application seeking the release of personal guarantors' property proceedings against the Corporate Debtor is against the scheme of the Insolvency and Bankruptcy Code, 2016 and in suppression of the 2nd Respondent's right to enforce the security interest upon the said properties under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act and allied provisions. It is also stated that the 2nd Respondent after expiry of the moratorium period granted in the Corporate Insolvency Resolution, initiated proceedings under SARFAESI Act on 29.12.2019, against the properties of the Personal Guarantors. Thereafter on 20.02.2020 this respondent as a secured Financial Creditor had duly submitted its proof of claim filing Form D dated 19.02.2020 before the Liquidator and relinqu....
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....orate Debtor. 3) The Liquidator is directed to strictly follow the procedures to take over the property in question, as per the Regulations. 4) This order should be implemented immediately on receipt of copy of this order, at any rate within 2 weeks from the date of receipt of the order. 15. Subsequently the Personal Guarantors have preferred Writ Petitions against the order of this Tribunal before the Hon'ble High Court of Kerala filing WP (c) No. 3864/2021, WP (c) No.3872/2021 and WP (c) No.4672/2021 challenging the order dated 1.2.2021 in MA/76/KOB/2020 of this Tribunal. The Hon'ble High Court of Kerala disposed of the aforesaid Writ Petitions on 26.04.2021 partially allowing and directing this Tribunal to hear the MA/76/KOB/2020 afresh by providing an opportunity to the Personal Guarantors/Petitioners in the Writ Petitions before passing an order in the present application. The operative portion of the order in the Writ Petitions is extracted below: - "In the circumstances, the impugned order in MA No.76/KOB/2020 dated 01.02.2021 of the National Company Law Tribunal, Kochi Bench, Kerala (Ext.P4 in WP(C) No.3864/2021) is set aside to the extent it allows the Liquidator to....
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....s precisely the intent behind excluding the property at the hands of the 3rd party to be included in the liquidation estate of the company. Therefore, the invocation of Section 60(5) of the Insolvency & Bankruptcy Code herein is perse unsustainable under law. 19. They have further stated that the properties of the Respondents 3 to 5 comprising of 60.613 Ares of land is also mortgaged to Union Bank of India, but the same does not belong to the Corporate Debtor and it is in exclusive possession of the guarantors. It is also stated that no separate proceedings under the Insolvency & Bankruptcy Code has been initiated by the Financial Creditor against the guarantors and, therefore, mere fact that the promotors have permitted the Corporate Debtor to construct quarters for the Doctors of the hospital cannot be a fact which would influence the decision of the Tribunal to order addition of the property so mentioned as the liquidation estate in terms of Section 36 of the Insolvency & Bankruptcy Code. They contended that there is no power vested with the Tribunal to do so in the light of the specific embargo created under Section 36 of the Insolvency & Bankruptcy Code, which cannot be wrigg....
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.... relief from this Tribunal, that their properties cannot be treated as properties of the Corporate Debtor, which is proceeded under the IBC. We cannot treat them as 3rd parties, as they were part and parcel of the Corporate Debtor. In view of the fact that they have mortgaged their properties to the Corporate Debtor and the Corporate Debtor is now reached in the stage of Corporate Insolvency Process. The liquidator has rightly proceeded against their properties also for completion of the liquidation process. We do not find any merit in the contention of Respondents 3 to 8. 22. Moreover, since the Resolution Professional has to conclude the proceedings, it is highly necessary to get the possession of the property, as it is the duty of the Resolution Professional to dispose of the Liquidation Assets of the Corporate Debtor, if necessary, to settle the claims of all claimants including the Financial Creditors. Since, the Building/hospital is situated in the very same land having 16.55 Ares, no purpose would be served without getting the hospital property also into the Liquidation Assets. It is also noticed that the 1st Respondent Union Bank of India has no objection in handing over t....