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2024 (6) TMI 90
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....e Project. Aggrieved by the admission order, this Appeal has been filed. 2. Brief facts necessary to be noticed for deciding the Appeal are : - 2.1. Greater Noida Authority by Lease Deed dated 26.12.2008 allotted Plot No.26/1 to M/s. Zestha Projects Pvt. Ltd. A joint Agreement was entered between M/s. Zestha Projects Pvt. Ltd. and the Corporate Debtor on 16.04.2007 for development of Plot of 40470 Sq. Mts. located in Knowledge Park-III, Greater Noida (U.P). The Corporate Debtor launched Real Estate Project on the lease land by name and style of Vardhaman I Valley. Project comprised of IT/ ITES office, Residential Units, Commercial Spaces and other facilities. The Respondents herein applied for allotment and after year 2007 have been allotted different units. Respondents-allottees have also paid 70% -100% of consideration and entered into respective Builder Buyer Agreements. Corporate Debtor had promised to complete and handover the possession in three to four years and further promised assured return @ 12% during the intervening period. A revised dates of possession was informed to the allottees as 2018-19 which was also not honoured. The project was registered with Real Esta....
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....te photographs given as late as 02.07.2021 clearly established the incomplete construction till date. Aggrieved by the order, this Appeal has been filed. 3. Appeal was entertained on 21.02.2023 and an interim order was passed directing the IRP to ensure that the Corporate Debtor run as a going concern and IRP to take steps for completion of project with the assistance of suspended directors/ex-management and employees and further the CoC was not to be constituted in pursuance of the impugned order. 4. We have heard Shri Saurabh Kirpal, Learned Senior Counsel for the Appellant, Shri Abhishek Anand, Learned Counsel for the Resolution Professional and Learned Counsel appearing for the allottees. 5. Shri Saurabh Kirpal, Learned Senior Counsel appearing for the Appellant challenging the impugned order submits that for completing the threshold of 100 allottees as required by Section 7 of the IBC, number of Financial Creditors are not to be counted and it is the units which are to be counted. It is submitted that the application was not filed by 100 unitholders and they were actually 99 unitholders only. It is submitted that subsequent impleadment of further unitholders shall not....
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....ho represent 122 allotted units. It is submitted that the Adjudicating Authority has returned a finding that there are 122 allottees who have filed the applications. It is submitted that the Adjudicating Authority permitted amended memo of parties to be brought on record by order dated 12.09.2022, hence, the amended application can also be looked into to find out number of allottees. It is submitted that the project is neither completed nor any Occupancy Certificate has been given to the Corporate Debtor. Appellant himself has brought material on record to indicate that Greater Noida Authority has raised various objections with regard to claim of Corporate Debtor of Occupancy Certificate. Occupancy Certificate having not yet been issued, there is no occasion of handing over possession to the allottees. It is submitted that the Status Report filed by the IRP dated 11.10.2023 clearly indicate that all works pertaining to residential tower, IT block, commercial block are pending. Detailed report given by the IRP clearly indicate that No Occupancy or Completion Certificate has been received by the Corporate Debtor. Several NOCs are still waiting. It is submitted that the fact that cert....
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....h of the allottees, whichever is less. 187. As far as the situation projected about, there being no clarity regarding whether, if there is a joint allotment of an apartment to more than one person, is it to be taken as only one allottee or as many allottees as there are joint allottees, it would appear to us, on a proper understanding of the definition of the word "allottee" in Section 2(d) and the object, for which the requirement of hundred allottees or onetenth has been put, and also, not being oblivious to Section 399(2) of the Companies Act, 1956, as also the Explanation in Section 244(1) of the Companies Act, 2013. in the case of a joint allotment of an apartment, plot or a building to more than one person, the allotment can only be treated as a single allotment. This for the reason that the object of the statute, admittedly, is to ensure that there is a critical mass of persons (allottees), who agree that the time is ripe to invoke the Code and to submit to the inexorable processes under the Code, with all its attendant perils. 188. The object of maintaining speed in the CIRP and also the balancing of interest of all the stakeholders, would be promoted by t....
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....itors were further added. In this context, we may refer to the orders passed by the Adjudicating Authority. On 01.08.2022, IA No. 2524 of 2022, following order was passed:- "IA-2524/2022 This is an application filed by the Twenty Two (22) allottees claiming to be real estate allootees, seeking impleadment in the Section 7 Petition i.e., CP (IB)- 674(PB)/2021. Notice was ordered on 19.07.2022, at the request of the Ld. Counsel for the Respondent, time was granted to file his reply. He further submits that Reply is filed. Reply is taken on record. In view of the fact that the section 7 petition is not admitted so far, IA-2524/2022 is allowed and disposed." 12. Further IA No.2624 of 2022 filed by the two allottees was allowed by same order dated 01.08.2022 which is as follows:- "IA-2624/2022 This is an application filed by the two (2) allottees claiming to be real estate allootees, seeking impleadment in the Section 7 Petition i.e., CP (IB)- 674(PB)/2021. Notice was ordered on 19.07.2022, at the request of the Ld. Counsel Respondent, the time was granted to file his reply. Reply is filed, considered th....
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.... site namely i.e., Vardhman I Valley wherein five (5) Towers are to be constructed namely i.e., Residential Tower, 1.T Block, Hotel, Club Block and Commercial Block known as Galleria and assist the IRP to evaluate the status of completion of the Project for submission of report before this Hon'ble Appellate Tribunal. The status of each Block / Tower of the Project as per the Report submitted by the Surveyor is produced herein below : Sr. No. Tower/Block Name Pendency of Work in Percentage Observation noted by the Surveyor 1. Residential Tower: Studio (Basement), Apartment Ground floor and 13 floors. 65% • The Residential Tower is not currently ready for inhabitation. The Residential Tower is not ready for possession. 2. I.T Block: Basement, Ground Floor and Total 9 Floor. 52% • The IT. Block is not ready for functioning. 3. Hotel: Basement, Ground Floor and 8 Floors. 34% • The Hotel tower is not ready for possession The Hotel tower is not ready for functioning. 4. Club Block: Basement, Ground Floor and 9 fl....
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....5. Structure Stability Certificate Not Available 17. Paragraph 12(e) on which reliance has been made by the Appellant is as follows:- "e. Commercial Block (Galleria): Basement, Ground Floor and 2 Floors: The Shutters of the various Units in the said Tower/ Block were down and were locked. The Status of the possession of the Units in the said Block could not be determined. However, Flex Boards/notices of various Professionals/ businesses were affixed in some of the Units of the said Tower/Block. Around 23 units in the said Block/Tower were having Flex boards/notice/ Address Board on them. While none of these units were open and shutters of all these units were closed during all the visits made at the Project site by the Answering Respondent, it can be assumed that the said Units were in the possession to the Unit holders/ buyers of the Corporate Debtor. A copy of the Photographs taken in respect of such Units is annexed herewith as Annexure R-9 (Colly)." 18. When we look into the Report of the IRP, it was clearly mentioned that there were no possession of the unitholders noticed except Unit No.10A in the IT Block which was open and in possession of PAN ....
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....& No Claim Certificate I, Kamal Bhardwaj Son of Shri Jagdish Bhardwaj Resident of House No-839/10, Naiyon Wali Gali, Main Bazar, Jind, Haryana-126102 had booked Office Space Unit no.115-C measuring 370Sq. Ft. (Super Area) in your project "Vardhman i-V@lley" (IT Square) situated at Plot No.26/1, Knowledge Park-III, Greater Noida (UP) of M/s Vardhman Estate & Developers Pvt. Ltd., i.c. the Company. I, hereby expressly agreed and forgo all my claim such as interest/ delay interest/ charges/ penalty etc. against the company in relation to said unit as per the builder buyer agreement and also any claim under the provision of RERA. _________________ Kamal Bhardwaj" 20. The above No Dues and No Claim Certificates at best can be read as certificates given by allottees to forego all claims such as delay interest charges penalty etc. relating to said unit. The said No Dues and No Claim Certificate cannot in any manner be read as the person giving no dues certificate is no more allotttee of the unit. Sub-Lease Agreement which has been executed by corporate debtor in favour of Kamal Bhardwaj dated 05.03.2020 although mentions Agreement to Sub-Lease with p....
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....r the CD that some of the allottees of units have taken back the money and No Due certificates have been issued in favour of the CD. Therefore, they did not remain allottees and therefore they cannot make claim. However, it is to be noticed that the agreements signed by the CD with those intending unit holders continue to remain on record and have not been cancelled so therefore the agreements are valid in law. This contention too does not merit consideration." 22. The application under Section 7 filed by the Financial Creditors claimed amount of debt of Rs.39,18,80,005.35/- which included principal and interest. The issue pertaining to fulfilment of threshold by allottees was elaborately considered by the Hon'ble Supreme Court in Manish Kumar Case (supra). The Hon'ble Supreme Court has held that application under Section 7 can be moved provided applicants are Financial Creditors and there must be a default of Rs.1 Crore. It was held that only change which has been brought after the amendment is that the application can be presented by the allottees in those requisite number introduced by the proviso and default can be qua any of the applicants. In paragraphs 170 and 171, follow....
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....re being amounts due to him, prior to the amendment, undoubtedly, a single allottee could set the ball in motion and all he had to satisfy is default to him or any other financial creditor. The change that is brought about is only that apart from establishing the factum of default, he must present the application endorsed by the requisite number introduced by the proviso. Since, default can be qua any of the applicants, and even a person, who is not an applicant, and the action is, one which is understood to be in rem, in that, the procedures, under the Code, would bind the entire set of stakeholders, including the whole of the allottees, we can see no merit in the contention of the petitioner based on the theory of default, rendering the provisions unworkable and arbitrary." 23. The submission advanced by the Counsel for the Appellant that application did not fulfil the threshold of 100 allottees, thus, is factually incorrect and cannot be accepted. Applicants who had filed the application represented more than 100 units, hence, the application could not be said to be deficient in any manner. It is also relevant to notice that application was filed in October, 2021 and more tha....