TaxTMI 
TaxTMI 
2026 (3) TMI 1646
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....cupying the part of the premise of the Corporate Debtor has been allowed by the impugned order directing the Appellant to vacate and handover possession within 30 days. Aggrieved by the said order, this Appeal has been filed. 2. Brief facts of the case necessary to be noticed for deciding the Appeal are:- 2.1. The Corporate Debtor- Shree Ram Urban Infrastructure Ltd. is a Real Estate Company engaged in infrastructure development. The Corporate Debtor in February/ March 2008 permitted the Appellant, who was supplying marbles and stones to the Corporate Debtor to set up a sales office at the premises to avoid transportation delays and minimise logistical costs. Appellant set up sales office on part of Plot No.9 situated at Shriram Mills premises. The Appellant was initially supplying the marbles and stones to the Corporate Debtor and was catering Corporate Debtor exclusively. However, from December 2008, Appellant was permitted to carry on its business operation from the premises by catering to other customers. A Winding-Up Petition No.1066 of 2015 was filed by Action Barter Private Limited against the Corporate Debtor before the Bombay High Court seeking winding up of the Corp....
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.... necessary co-operation /assistance of police personnel for taking back the peaceful and vacant possession to the property. In the application filed by the Resolution professional, reply was filed by the Appellant raising plea that Adjudicating Authority has no jurisdiction to evict tenant/lessee. There is no valid authorisation of assignment in favour of the RP and necessary facts have been supressed by the Resolution Professional. The case of the Appellant was that it supplied marbles and stones from 2006 to 2013 and principal amount of Rs. 1,34,86,201/- is due. It was pleaded that the Corporate Debtor permitted the Appellant was allowed to continue to occupy so as to settle the outstanding dues from the Corporate Debtor. The application filed by the Resolution Professional was fixed for hearing on 02.12.2025. Appellant filed a S.C. Suit No.2944 of 2025 on 01.12.2025 before City Civil Court at Bombay seeking perpetual injunction from interfering with the Appellant's possession of the premises. Hearing in application filed by the Resolution Professional being IA No.1697 of 2025 which was concluded on 02.12.2025 and parties were asked to file written submissions by 10.12.2025. On 0....
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....in the application filed by the Resolution Professional for eviction of the Appellant. Adjudicating Authority does not have jurisdiction over matters which are dehors the insolvency proceedings. The Adjudicating Authority is not empowered to pass an order of eviction. It is submitted that the Adjudicating Authority failed to appreciate that the Appellant had an oral tenancy with the Corporate Debtor. It is submitted that oral lease with the Corporate Debtor is permissible under the provisions of the Transfer of Property Act, 1882. Oral understanding between the parties has not been correctly appreciated by the Adjudicating Authority. The Adjudicating Authority disregarded the oral direction passed by the Bombay High Court on 01.07.2019 as well as the interim order dated 09.12.2025 passed by the City Civil Court. It is submitted that the liquidator could not take possession due to oral order passed by the Bombay High Court in the application which was filed by the Appellant in the pending Company Petition before the Bombay High Court. Further interim injunction granted by City Civil Court on 09.12.2025 has been disregarded although fact of obtaining interim order on 09.12.2025 was b....
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....premises which was not complied with leading to the Resolution Professional filing an application directing for eviction of the Appellant. Adjudicating Authority is the appropriate authority to decide the issue raised by the Resolution Professional in the application. It is the duty of the Resolution Professional to take possession of the property belonging to the Corporate Debtor under Section 18(1)(f) and Section 25 of the IBC. The submission of the Appellant that the Adjudicating Authority has no jurisdiction to direct for eviction of the Appellant is wholly erroneous. The submission of the Appellant relying on order of the City Civil Court dated 09.12.2025 also does not support the Appellant, Section 63 of the IBC clearly exclude the jurisdiction of any Civil Court. Further under the order dated 09.12.2025, only protection was that Appellant shall not be evicted without due process of law. Appellant is being evicted under due process of law, hence, the order of the Civil Court does not come to any rescue. Reliance placed on oral order passed by the Bombay High Court on 01.07.2019 also does not improve any case of the Appellant since in the application filed by the Appellant, no....
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.... 8. There is no dispute between the parties that the part of premises of the Corporate Debtor measuring 1701.3 sq. mtr. out of area 3046 sq. mtr. is in possession of the Appellant. It is an admitted fact that the Corporate Debtor is owner of the premises. It is the duty of the IRP under Section 18(1)(f) to take control and custody of any asset to which Corporate Debtor has ownership rights. Section 18(1)(f) is as follows:- "18. Duties of interim resolution professional. - The interim resolution professional shall perform the following duties, namely: - (f) take control and custody of any asset over which the corporate debtor has ownership rights as recorded in the balance sheet of the corporate debtor, or with information utility or the depository of securities or any other registry that records the ownership of assets including - (i) assets over which the corporate debtor has ownership rights which may be located in a foreign country; (ii) assets that may or may not be in possession of the corporate debtor; (iii) tangible assets, whether movable or immovable; (iv) intangible assets including intellectual property; (....
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....re of the view that Resolution Professional had every jurisdiction to file an application before the Adjudicating Authority for taking possession of the assets. Learned Counsel for the Appellant in support of the submission that the Adjudicating Authority has no jurisdiction to entertain the application has relied on the judgment of the Hon'ble Supreme Court in "Gujarat Urja Vikas Nigam Ltd. vs. Amit Gupta- (2021) 7 SCC 209", "Tata Consultancy Services Ltd. vs. SK Wheels Private Limited- (2022) 2 SCC 583" and "Embassy Property Developments (P) Ltd. vs. State of Karnataka- (2020) 13 SCC 308". The Hon'ble Supreme Court in a subsequent judgment "Victory Iron Works Limited vs. Jitendra Lohia and Anr.- (2023) 7 SCC 227" had occasion to consider the nature of jurisdiction of the NCLT in respect to an application filed by the Resolution Professional to protect its possession. In the said case, the Hon'ble Supreme Court has also occasion to consider the judgment of the Hon'ble Supreme Court in Tata Consultancy Services Ltd. and Embassy Property Developments (P) Ltd. (supra). In the above case, the Resolution Professional of the Corporate Debtor had filed an application before the Adjudicat....
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..... Further, considering the earlier judgment of the Hon'ble Supreme Court in paragraphs 45, 46, 47 and 48 following was laid down:- "45. Embassy Property Developments [Embassy Property Developments (P) Ltd. v. State of Karnataka, (2020) 13 SCC 308] arose out of a case where, under the guise of preserving and protecting the interests of the corporate debtor, NCLT issued [Vasudevan v. State of Karnataka, 2019 SCC OnLine NCLT 681] a direction to the Government of Karnataka to grant renewal of a mining lease, in terms of the deeming provision in Section 8-A(6) of the Mines and Minerals (Development and Regulation) Act, 1957. Raising the question of jurisdiction of the NCLT to issue such a direction, the Government of Karnataka approached the High Court by way of a writ petition, instead of filing a statutory appeal to NCLAT. The jurisdiction of the High Court to entertain the said writ petition and also grant interim stay [State of Karnataka v. Tiffins Barytes Asbestos & Paints Ltd., 2019 SCC OnLine Kar 2463], was what was questioned before this Court in the said decision. The right to have a mining lease granted by the Government, was neither a statutory right nor a contractua....
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....by Victory. A careful look at the application filed by Victory in C.A. (IB) No.146 of 2020 would show that there was no whisper about Victory occupying any land in excess of what they were permitted to occupy under the Leave and License Agreement. Under the Leave and License Agreement, Victory was allowed to occupy only 10000 sq. ft. of land, upon payment of a monthly license fee of Rs. 5,000/-. If at all, a vague averment was made in paragraph VII (c) of their application to the effect that inasmuch as the Corporate Debtor was unable to commence any development activity in the subject land, the owner and the developer, with their full consent, had decided to allow the applicant to run its business in the usual course from the subject land, because the subject land could not have been left vacant for any substantial period of time. 52. The fact that there were security guards posted in the property is borne out by records. This is why NCLT as well as NCLAT have done a delicate act of balancing, by protecting the interests of Victory to the extent of the land permitted to be occupied. In fact, Victory does not even have the status of a lessee, but is only a licensee. A lice....
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....it for eviction of the Appellant under MP Accommodation Control Act, 1961 even though lease in favour of the Appellant has expired shall be unduly prolonging the insolvency process which is a time bound process. When the Corporate Debtor has the ownership rights over the premises which premises can be taken in control by IRP/RP, we are of the view that for eviction of the Appellant especially in event when lease in favour of the Appellant has come to an end, filing a suit is not contemplated in the statutory scheme contained in IBC. 21. Thus, the contention of the Appellant that RP has to file a suit for eviction of the Appellant under the MP Accommodation Control Act, 1961 can not be accepted. We thus, in view of the foregoing discussions are of the considered opinion that Adjudicating Authority has rightly allowed the Application filed by the RP directing the Appellant to vacate from the premises so that Resolution Plan which has been approved can be implemented. We thus do not find any merit in the Appeal, the Appeal is dismissed." 17. The above judgment was also affirmed by the Hon'ble Supreme Court by its judgment and order dated 10.02.2023 in "Jhanvi Rajpal Automo....
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....2nd December 2008 is annexed herewith to this minutes as Exhibit - "B". Thereafter the representation of the Official Liquidator requested to Shri Mashrut FoF to vacate the aforesaid premises and remove the goods/materials belongs to Classic Marble Company which are lying in the aforesaid premises. However he informed that there were huge and heavy material are lying in the aforesaid premises. And also he informed that they have not received any prior intimation from the official Liquidator to vacate the premises. However, Shri Mashrut FoF requested the representatives of the official Liquidator to allow one month time to remove the huge and heavy materials and vacate the aforesaid premises. The request received from Shri. Mashruf FoF not accepted and the representatives of the Official Liquidator proceeded for physical possession. However Shri Mashruf FoF has strongly objected to take physical possession of the aforesaid premises, since there is no specific court order or any intimation to take physical possession of classic Marble Company. Therefore the representative of the Official Liquidator taken symbolic possession of the classic Marble Company which is situated at ....
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...., liquidator has already taken steps in the winding up proceeding to take possession and symbolic possession was taken. Bombay High Court had subsequently noticed that Provisional Liquidator stand discharged. After initiation of the CIRP against the Corporate Debtor under the Insolvency and Bankruptcy Code, it is the Resolution Professional who has to take all steps regarding the assets of the Corporate Debtor, the Liquidator having been discharged. It is relevant to notice that Appellant also filed an application before the Bombay High Court in the winding up petition being Company Application No.261 of 2019 on 01.07.2019 in which no order could be obtained by the Appellant except according to Appellant an oral order was passed on 01.07.2019 that till the next date i.e. 03.07.2019, liquidator not to take possession. 22. We thus, are of the view that Resolution Professional was fully entitled to file an application and application filed by Resolution Professional is fully maintainable and is within jurisdiction. The submission of the Appellant is that the Resolution Professional has to prove nexus with the insolvency with respect to the application filed under Section 60(5)(c). ....
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....nding amount which was due on the company. An additional- affidavit has been filed to the said application 261 of 2019 where Appellant has pleaded the relevant facts and the statement that company permitted the Appellant to occupy the property till payment of the outstanding dues. In paragraph 12 of the Affidavit, following was pleaded:- "12. In or about April 2013, the Respondent represented to the Applicant Company that due to financial difficulty, they were unable to pay off the Applicant Company's outstanding amounts against the materials supplied and invoices raised on the Respondent Company. The Respondent Company requested the Applicant Company to continue to occupy the said Property till payment of the outstanding dues. Further, the Respondent requested that the interest amount, on the outstanding amount payable by the Respondent Company shall be adjusted towards the compensation for the use of the said Property by the Applicant Company. It was agreed that neither the Respondent Company would be liable to pay any interest to the Applicant Company on the outstanding dues, nor would the Applicant Company be liable to pay any amounts to the Respondent Company for ....
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....aches. 16. The Applicant Company's valuable materials are lying on the said Property. I say that it is practically not possible to shift such bulky material within a short span of time. We therefore humbly pray that this Hon'ble Court be pleased to permit the Applicant Company to remain in possession of the said Property, on such terms and conditions, as may this Hon'ble Court may deem fit and proper, in the facts and circumstances of the present case. The Applicant humbly submits that grave and irreparable harm, loss and prejudice would be occasioned to the Applicant Company, if the possession of the said Property is taken over by the Official Liquidator. On the other hand, no such harm or loss will be caused to the Official Liquidator and the parties involved, if the reliefs as sought for are granted. The balance of convenience tilts heavily in favour of the Applicant." 27. During submissions before the court, Learned Counsel for the Appellant submits that there was oral tenancy created in favour of the Appellant since the interest amount on the outstanding amount on the company was to be adjusted in the rent. However, neither details of any rent paid nor ....
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....e Court in the above case held that if the two parties are executing their rights and liabilities in the nature of a landlord-tenant relationship and if regular rent is being paid and accepted, then the mere factum of non-registration of deed will not make the lease itself nugatory. There cannot be any dispute to the above proposition. Present is a case where neither there is a claim of payment of any rent by the Appellant to the Corporate Debtor nor there is even an iota of evidence of any payment of any rent. The claim of the oral tenancy by the Appellant is nothing but imagination of the Appellant to somehow justify its illegal occupation. It is the Appellant case itself that it supplied the marbles to the company till 2013 and according to the case of the Appellant, an amount of Rs. 1,34,86,201/- is due on the company, hence he was allowed to continue. Appellant has also placed reliance on the judgment of the Hon'ble Supreme Court in "Madan Mohan Singh vs. Ved Prakash Arya- (2021) 5 SCC 456" where Hon'ble Supreme Court held that the agreement of tenancy can be both by writing or oral and in the case of oral tenancy, the court has to look into the circumstances and intention of ....
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....nd Establishment Act 2017 was filed by the Appellant before the Bombay High Court. The said registration certificate in paragraph 3 clearly provided as follows:- "नमुना- "व" Form-B नोंदणी प्रमाणपत्र Registration Certificate (नियम 5 (1) पहा) (See rule 5(1)) १. नोंदणी क्रमांक 1. Registration Number : 820324974/GS Ward/ COMMERCIAL II २. आस्थापनेचे नाव 2. Name of the Establishment: CLASSIC MARBLE COMPANY PVT. LTD. ३. सदरचे नोंदणी प्रमाणपत्र अर्जदाराने ऑनलाईनद्वारे अर्जासोबत स....
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.... uploaded self-certified documents and declaration given by the applicant without physical verification of the existence of est- ablishment the nature of business carried out and the details mentioned in the application. This is just a certificate of registration and does not give any right to property or possession or title of the rights of the premises or property. ४. व्यवसाय सुरु करण्यात आल्याचा दिनांक 4. Date of commencement of Business: 01.01.2017 ५ मालकाचे नाव : MR. AMIT MAFATLAL SHAH 5. Name of the Employer ६. व्यवसायाचे स्वरुप 6. Nature of Business : BUILDING MATERIAL SUPPLIERS ७ आस्थापनेचा पत्ता :03-A, SRIRAM MILL COMPOUND, GM BHOSALE MARG WORLI, 7. Address of Est....