Haravtar Singh Arora vs Navneet Gupta & Anr

IN THE MATTER OF: Haravtar Singh Arora, Erstwhile promoter of James Hotel ...Appellant

Versus Navneet Gupta, Liquidator of James Hotel & Anr. ...Respondent Present: For Appellant: Mr. Abhijeet Sinha, Mr. Kumar Anurag Singh, Mr. Zain A Khan, Advocates For Respondent: Mr. Gaurav Mitra, Mr. NPS Chawla, Mr. Ishan Roy Choudhury, Advocates for Successful Bidder. Mr. Manuj Nagarth, Mr. S. Vinod, Advocate for Mr. Navneet Gupta, Official Liquidator Mr. Surekh Kant Baxy, Mr. Sujoy Datta, Ms. Sejal Sethi, Advocates for Successful Bidder.

ORDER

01.03.2023: Heard Learned Counsel for the Appellant.

2. This Appeal has been filed against the Order dated 04.11.2022 passed by

the National Company Law Tribunal, Chandigarh Bench, Chandigarh

(hereinafter referred to as "The Adjudicating Authority") by which CA No. 15 of

2020 and I.A. No. 553 of 2020 has been decided. The Appellant-Suspended

Director of the Corporate Debtor has come up in this Appeal challenging the

Order. When the Auction Notice was issued by the Liquidator for auction of the 2

Corporate Debtor as a going concern, CA No. 15 of 2020 was filed challenging

the Auction Notice and subsequent to the auction held on 03.02.2023, I.A. No.

553 of 2020 has been filed, both the Applications have been rejected by the

impugned Order.

3. Mr. Abhijeet Sinha, Learned Counsel for the Appellant submits that the

property was a leased property from the Chandigarh Administration and there

was no permission taken from the Chandigarh Administration for transfer of the

property. He further submits that under Regulation 32-A (4), if the sale of the

corporate debtor is not done within 90 days from the liquidation commencement

date, Liquidator was to proceed to sell the assets under Clause 'a' to 'd' of

Regulation 32-A. Learned Counsel for the Appellant has also referred to Letter

dated 06.05.2019 of the Chandigarh Administration which has been referred to

by the Adjudicating Authority.

4. We have considered the submissions of Learned Counsel for the Appellant

and have perused the record.

5. There is no dispute between the parties that there was a lease by the

Chandigarh Administration and the auction of the Corporate Debtor was

proposed as going concern. The letter dated 06th May, 2019 referred to by the

Learned Counsel for the Appellant was issued by the Chandigarh Administration

where mention was made regarding the amount chargeable on account of

transfer fees.

Company Appeal (AT) Ins. No. 128 of 2023 3

6. Learned Counsel - Mr. Gaurav Mitra for the Respondent submits that

present is a case where lease deed continues in the name of Corporate Debtor

hence what is sold is the shares of the corporate debtor.

7. Be that as it may, we do not find any error in the carrying out auction of

the corporate debtor as going concern.

8. Further submission is that under Regulation 32A sub-clause 4, auction

did not take place within 90 days hence assets ought to have been sold under

Clause 'a' to 'd'. It is not denied that auction sale notice was issued initially prior

to the insertion of provision of Regulation 32A, hence we are of the that in the

auction, regulation 32A sub-clause (4) cannot be pressed in service.

9. We thus are of the view that no ground has been made to interfere with

the Impugned Order. The appeal is dismissed.

[Justice Ashok Bhushan] Chairperson

[Barun Mitra] Member (Technical)

Basant/nn

Company Appeal (AT) Ins. No. 128 of 2023