TaxTMI 
TaxTMI 
2024 (11) TMI 1082
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....ial space buyer, who were allotted commercial spaces in a Project 'Coral Brio'. Company Appeal (AT) (Ins.) No.40 of 2024 has been filed by the Appellant challenging order dated 30.10.2023 passed by National Company Law Tribunal, New Delhi Principal Bench in Company Petition No.(IB)-593(PB)/2018, by which order Resolution Plan submitted by Mr. Manish Kumar Bansal, Mr. Rajesh Gupta and Mr. Mukesh Chand Tyagi, consortium of individuals has been approved. Company Appeal (AT) (Ins.) No.40 of 2024 has been filed challenging the order approving the Resolution Plan. 2. Company Appeal (AT) (Ins.) No.45 of 2024 has been filed by the same Appellants, who have filed Company Appeal (AT) (Ins.) No.40 of 2024 challenging the order of the NCLT dated 05.10.2023 passed in IA No.5253 of 2023 in C.P. (IB) No. 593 (PB) of 2018. By the impugned order dated 05.10.2023, IA No.5253 of 2023 filed by the Appellants has been disposed of, observing that IA has been filed belatedly and the matter has already been progressed at the stage of being reserved for orders. 3. Company Appeal (AT) (Ins.) No.61 of 2024 has been filed by another commercial space buyer challenging order dated 30.10.2023 passed by Adjudic....
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....heir claims on 02.12.2019. The Appellant in Company Appeal (AT) (Ins.) No.61 of 2024 filed its claim on 14.02.2019. The Appellant - Nupur Garg again submitted a consolidated Form CA on 05.03.2019. The RP verified the claim of Appellant and has issued a List of Financial Creditors in the class of Commercial Space Buyer, which included the name of the Appellants of Company Appeal (AT) (Ins.) No.40 of 2024 at Sl. No.21 and Appellant - Nupur Garg at Sl. No.17, admitting their claims. (v) In the CIRP of the Corporate Debtor, Resolution Plan was submitted by individual of consortium. The Committee of Creditors ("CoC") on 16.01.2020/ 30.10.2020 approved the Resolution Plan with 87.49% vote shares. The Resolution Plan offers payment of 50% of the principal amount to the class of commercial space buyers and in alternate permitted them to opt for equivalent commercial space at alternate places on rates as mentioned in the Resolution Plan. The RP immediately filed an application being IA No.1642 of 2020 praying for approval of the Resolution Plan. (vi) The Appellant - Nupur Garg filed an IA being 3524 of 2020 praying for various directions including exclusion of commercial space/ office N....
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....paces, which were allotted to them and the offer made in the Resolution Plan is not acceptable. Alternate commercial spaces, which are provided in the Plan are on very high rate. 7. Learned Counsel appearing for the Appellant - Nupur Garg in support of the Appeal contends that the Appellant has paid the consideration for allotment. The Appellant having been allotted commercial space, with regard to which, Lease Deed was also executed by the CD and the Appellant was also entitled for the rent. The Lease Deed have been executed in favour of the Appellant only on the premise that the Appellant is owner of the commercial space. The Corporate Debtor has always accepted his liability to pay the agreed rent for the commercial space SF-05, but has not made provision of the rent in books of accounts, on account of grave fund crisis. The Resolution Plan does not accept the claim of the Appellant that Appellant is the owner of the commercial space and the said space being SF-05, ought to have been excluded from the Resolution Plan. The Appellant was entitled for execution and registration of Sale Deed. The Resolution Plan, ought to have been amended to include the rental dues. The case of th....
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....nancial Creditors are entitled only for the liquidation value as per Section 30, sub-section (2). The liquidation value of both the Appellant(s) are 'zero', however, the SRA has proposed to pay the Appellant 100% of principal amount of claim admitted in the CIRP. The SRA has also deposited the substantial amount before the Monitoring Committee and Appellant(s) are free to get release of their principal amount from the Monitoring Committee. It is submitted that SRA has submitted its Plan for Hotel, which has guest rooms, suits, halls and restaurants etc. The SRA is taking over a Company, which own, run and manage a hotel. Except the three allottees, who were Appellants in Company Appeal (AT) (Ins.) No.45 of 2024, rest of five allottees of ground floors, have accepted the Adjudicating Authority order of refund of 100% principal by not filing any appeal. The approval of the Plan by CoC with 87.49% by majority, is binding on all concerned. The Appellant(s) are also bound by the Resolution Plan. The prayer of the Appellant - Nupur Garg that assets be excluded from the Resolution Plan, cannot be accepted. Nupur Garg and other Appellants cannot claim ownership of the commercial spaces. Th....
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....o claimed execution of Lease Deed in her favour dated 24.12.2014 for a period of nine years with effect from 01.01.2015, where the CD undertook to pay monthly rent of Rs. 41,250/- per month for first 36 months and monthly rent of Rs. 47,438/- with effect from 01.01.2018. It is further claimed by the Appellant - Nupur Garg that after commencement of the CIRP on 11.01.2019, the rent upto June 2019 was paid and the Appellant in IA No.3524 of 2020 has prayed the direction to pay monthly lease rent with effect from July 2019. The allotment letter and Lease Deed executed in favour of the Appellant is an unregistered document. The transfer of title is contemplated by registered documents. It is well settled that allotment which is a contract between parties at best lead to as specific performance of contract. However, the allotment itself does not transfer any title in favour of the Appellant(s). The fact that title do not vest with the Appellant(s) is fully established from the prayers made in the IAs, which were filed by the Appellant(s) before the Adjudicating Authority, seeking directions to the CD through RP to execute a Sale Deed in favour of the Appellant(s). The prayer by the Appe....
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....o comprehensively deals with all the assets and liabilities of the Corporate Debtor and no housing project could be segregated for the reason that the same has been completed or is nearing completion. In paragraph 226, the Hon'ble Supreme Court laid down following: "226. For what has been discussed above, we hold that the homebuyers as a class having assented to the resolution plan of NBCC, any individual homebuyer or any association of homebuyers cannot maintain a challenge to the resolution plan and cannot be treated as a dissenting financial creditor or an aggrieved person; the question of violation of the provisions of the Real Estate (Regulation and Development) Act, 2016 does not arise; the resolution plan in question is not violative of the mandatory requirements of the CIRP Regulations; and when the resolution plan comprehensively deals with all the assets and liabilities of the corporate debtor, no housing project could be segregated merely for the reason that the same has been completed or is nearing completion." 16. The learned Counsel for the Appellant has also relied on the judgment of this Tribunal in Company Appeal (AT) (Ins.) No.350 of 2020 - Alok Sharma vs. M/s ....
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....and the plea of the Appellant(s) that assets be excluded from CIRP of the CD, or the Appellant(s) are owners of the commercial space/ units allotted to them, cannot be accepted. We answer both the questions accordingly. Question Nos.(III) & (IV) 19. From the facts, which have been brought on record, it is clear that both of the Appellant(s), i.e. Company Appeal (AT) (Ins.) No.40 of 2024 and Company Appeal (AT) (Ins.) No.61 of 2024 are the allottees of commercial spaces. They have respective voting shares. Nupur Garg has voting share of 0.88% and Appellant in Company Appeal (AT) (Ins.) No.40 of 2024 has voting shares of 0.81%. All commercial space buyers collectively have voting shares of 12.51%. In paragraph 2.2 of the impugned order, the Adjudicating Authority has noted the particulars of creditors, including the voting shares. Paragraph 2.2 of the impugned order is as follows: Particulars Number of Claims Claim Received (Rs.) Claim Admitted (Rs.) Voting Share% Secured Financial Creditor- Union Bank of India 1 43,69,66,133.85 43,69,66,133.85 44.20 Unsecured Financial Creditor- Baba Agribuild Private Limited 1 4,47,97,500 4,47,97,500 4.43 Financial Creditors- In ....
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.... a liquidation of the corporate debtor. Explanation 1. - For removal of doubts, it is hereby clarified that a distribution in accordance with the provisions of this clause shall be fair and equitable to such creditors. Explanation 2. - For the purpose of this clause, it is hereby declared that on and from the date of commencement of the Insolvency and Bankruptcy Code (Amendment) Act, 2019, the provisions of this clause shall also apply to the corporate insolvency resolution process of a corporate debtor- (i) where a resolution plan has not been approved or rejected by the Adjudicating Authority; (ii) where an appeal has been preferred under section 61 or section 62 or such an appeal is not time barred under any provision of law for the time being in force; or (iii) where a legal proceeding has been initiated in any court against the decision of the Adjudicating Authority in respect of a resolution plan;" 22. The above provision indicate that amount to be paid to the Financial Creditors, who do not vote in favour of the Resolution Plan shall not be less than the amount to be paid to such creditors in accordance with sub- section (1) of Section 53 in event of a liquidation....
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....Offer/ Possession Letter shall stand cancelled on NCLT approval date. 24. Thus, as per Resolution Plan and the order passed by the Adjudicating Authority, the commercial space buyer are entitled for 100% of their principal amount with alternate option for commercial space buyers. Thus, as per the Resolution Plan, the Appellant(s) are entitled either to opt for 100% refund of the principal amount within 90 days or to opt for an alternate option for commercial space, which is part of Resolution Plan. Thus, we are of the view that the Appellant(s) under Section 30, sub-section (2)(b) were entitled for only liquidation value, which according to the Resolution Plan is 'zero'. However, the SRA having offered 100% refund of the principal amount with alternative proposal for commercial space, the entitlement of Appellant(s) as per the Resolution Plan is of 100% refund of the principal amount or the option for alternate commercial space. 25. The law with regard to interference with the commercial wisdom of the CoC approving the Resolution Plan is well settled. The limited ground on which the Adjudicating Authority or the Appellate Tribunal can interfere with the approval of the Resolution....
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....he view that the prayer of the Appellant to exclude the commercial space from the Resolution Plan, could not have been accepted, nor any direction could have been issued for registration of Sale Deed. The claim, which was submitted by the Appellant was admitted in the CIRP. In the Appeal filed by Nupur Garg, at Annexure A-10, the list of financial creditors in the class of commercial space buyers has been annexed at page 175, which include the amount of claim submitted and amount of claim admitted by the RP. The name of Nupur Garg is at Sl. No.17, whereas name of Appellant in Company Appeal (AT) (Ins.) No.40 of 2024 are at Sl. No.21. The amount claimed and admitted with regard to the Appellant(s) in these Appeal(s) are as follows: 17 Nupur Garg 4,400,00.00 43,66,395.00 87,66,395.00 44,00,0 00.00 43,12,516.27 87,12,516.27 0.88% Service Tax Claimed as Principal not approved. Interest approved from may 15, 2014 from the agreed date of interest Rent and Interest on Rent is pending as the same is not reflecting in books. 21 Ravi kant Dwivedi, Naresh Singh Yadav and Praveen Arya 57,81,460.00 26,73,639.00 8,455,099,00 56,93,704.00 23,57,873.89 80,51,577.89 0.81% ....