Kadam Developers Private Limited vs Creative Souls Technology India ...

National Company Law Appellate Tribunal Principal Bench, New Delhi COMPANY APPEAL (AT) No. 91 of 2021 (Arising out of Order dated 20th July, 2021 passed by National Company Law Tribunal, New Delhi, Principal Bench, in C.P. No. 110/241-242/2021.)

IN THE MATTER OF:

Kadam Developers Private Limited Through its Board of Directors Flat No.- 502, 502-A, 5th Floor, 23 Barakhamba Road, Narain Manzil, New Delhi - 110001 secretarial@shipraworld.com ...Appellant

Versus

1. Creative Souls Technology India Limited Through its directors (Group Company of M3M India Private Limited) creativesoulstech@gmail.com

603, ASK Greens, GH-33, Sector-1, Manesar Gurgaon - 122051. ...Respondent No. 1

2. Mr. Manoj, Badshapur, Sector - 65, Gurugram, Haryana - 122001 creativesoulstech@gmail.com ...Respondent No. 2

3. Amit Walia STD - 608, Sun Tower, Shipra Suncity, Indirapuram, Ghaziabad, Uttar Pradesh - 201014. ...Respondent No. 3

4. Manmohan Singh House No. KL-3, Kavinagar, Block - L, Ghaziabad, Uttar Pradesh. ...Respondent No. 4

Appellant: Ms. Srishti Juneja, Mr. Abhijeet Sinha, Mr. Aditya Shukla, Mr. Saikat Sarkar, Ms. Gauri Rishi & Mr. Sanampreet Singh, Advocates. Respondents: Mr. Arun Kathpalia & Mr. P. Nagesh, Sr. Advocates alongwith Mr. Sidhartha Das, Mr. Saurabh Kalia, Mr. Gajanand Kirodiwal, Advocates for R-1 & R-2. -2-

JUDGEMENT

[Per; Shreesha Merla, Member (T)]

1. Aggrieved by the Order dated 20.07.2021, passed by the NCLT

(National Company Law Tribunal, New Delhi, Principal Bench) in C.P. No.-

110/241-242/2021, the Respondent- 'Kadam developers Private Limited &

Ors.' preferred this Appeal on the ground that the NCLT has erroneously

passed an Order directing Status Quo on the shares and assets of the

Appellant Company despite the fact that the entire share transactions was a

subject matter of challenge before the Hon'ble High Court of Delhi in various

connected matters.

2. The NCLT, by the Impugned Order has observed as follows:-

"This is a petition filed by a company called Creative Souls Technology India Pvt. Ltd. claiming themselves to be 100% shareholders of the respondent company. The main contention of the petitioner is that they have bought 100% holding from another company called India Bulls Housing India Limited. They are trying to appoint three of the persons as directors on the board of the company. The Respondent Company did not respond to the same and the only asset of the respondent company which is a 73 acres plot situated in Sector-128 Noida is being sold by the respondent company even before the petitioners appoint their persons as directors of the respondent company. The counsel appearing for the respondent is present and objects to the contentions raised by the petitioner that they are 100% shareholders and connected matters are pending in the High Court and it appears that there is an order restraining petitioners from exercising their rights as shareholders of the company.

Be that as it may, the fact remains that there is only one property situated in Noida which belongs to the respondent company and no harm is caused to either of the parties if an order is passed restraining the respondent from alienating the said property. In view of the same we direct the respondent to maintain status quo until the issue is completely resolved.

Company Appeal (AT) No. 91 of 2021 -3-

Therefore, we hereby passed status quo orders with regard to the property and also with regard to the structure of shares and the same shall be in force until further orders.

List the matter for further consideration on 26.08.2021."

3. The Learned Counsel appearing for the Appellant submitted that the

first Respondent 'M/s. Creative Souls Technology India Ltd.' is arrayed as

Respondent No. 4 before the Hon'ble High Court of Delhi and drew our

attention to the Order dated 19.07.2021 in OMP/1/COMM/213 of 2021,

between Shipra Estate Ltd. and Indiabulls Housing Private Limited & Ors., in

Paras 3 to 9, by which Order, it is observed as follows:-

3. It does appear that Indiabulls Housing Finance Limited (respondent no.1) has sold the shares held by Shipra Estate Limited in Kadam Developers Private Limited (respondent no.4) to respondent no. 13 (Creative Souls Technology India Limited) without issuing any specific notice indicating the name of the proposed purchaser or the consideration for the said shares. It does also appear from the Agreement to Sell, which has been placed on record that the price paid for the shares is less than the consideration that was mentioned before the Court in an earlier round of litigation [O.M.P. (I) 154 to 157 of 2021].

4. It has been earnestly argued on behalf of respondent no.13 that with the purchase of the shares, respondent no.13 had stepped into the shoes of respondent no.1. However, it is respondent no.1's case that the said shares were sold in exercise of its right as a pledge of those shares and not as assignment of its assets/rights. Thus, the contention that there was any subrogation is unpersuasive. It is also seen that the part of consideration, which was reflected in the agreement to sell, has been agreed to be infused into respondent no.4 company. There is no indication as to manner in which the said funds will be infused in respondent no. 4 company as it is agreed between respondent no. 1 and respondent no. 13 that the same is at the discretion of respondent no.13.

Company Appeal (AT) No. 91 of 2021 -4-

5. The question as to the right of respondent no.3 to structure an agreement requiring purchaser of the pledged shares to infuse funds into the company is also not free from controversy. The disputes raised in the present petition are not insubstantial.

6. The petitioner apprehends that respondent no.3 shall attempt to over management and/or further deal with the shares in question while the petition and other matters are being considered.

7. Since these petitions are being heard on an urgent basis, this court considers it apposite to direct the parties to maintain status quo as to the shares of respondent no. 4 company. Further, none of the parties shall exercise any rights in respect of the said shares.

8. It is clarified that the observations made in this order are tentative and should not be considered an expression of opinion (either prima facie or otherwise) determinative of any of the questions being considered. As noted above the petition is part heard and none of the parties are precluded from canvassing their contentions.

9. List on 20.07.2021."

4. It is the case of the Appellant that the entire transaction by way of

which the first Respondent has acquired shares in the Appellant Company

from M/s. Indiabulls Housing Private Limited was a subject matter of

challenge before the Hon'ble High Court of Delhi and when the Petition came

to be listed before the NCLT on 20.07.2021, the first Respondent concealed

the said proceedings and mislead the Tribunal. It is further contended by

the Learned Counsel that the Hon'ble High Court of Delhi on 02.08.2021 as

directed Indiabulls Housing Private Limited to produce the statements of

accounts and details of such transaction whereby Indiabulls Housing Private

Limited has transferred amounts into unidentified accounts on 03.07.2021.

He drew our attention to the statement of accounts whereby the Respondent

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Company has purchased shares worth Rs.750 Crores/-. We refrain from

passing any observations on this issue of transfer of funds into unidentified

accounts since it is not a subject matter before us.

5. Learned Counsel for the Respondent vehemently contended that the

Company Petition was filed on 11.07.2021 much before the Order of the

Delhi High Court which is dated 19.07.2021 and therefore the shareholding

as on the date of filing of the Petition is to be seen and the same was

disclosed to NCLT and there was no material suppression. It is the case of

the Respondents 1 & 2 that being 100% shareholders of the Appellant they

were constrained to file the Petition under Sections 241 & 242 of the

Companies Act on 16.07.2021. An advance copy of the Petition was duly

served on 19.07.2021. The copy of the Impugned Order dated 19.07.2021

was uploaded in the website of the Hon'ble High Court of Delhi on

20.07.2021.

6. The Learned Counsel submitted that Respondents 1 & 2 preferred an

Appeal before the Division Bench of Hon'ble High Court of Delhi against the

Order dated 19.07.2021 and the Hon'ble Division Bench vide Order dated

27.07.2021 issued Notices. Thereafter vide Order dated 11.08.2021 directed

the Single Judge to decide the said Petitions and next date of Hearing was

fixed on 07.09.2021. It is the case of the Respondents that on payment of an

amount of almost Rs.750 Crores/-, the pledged shares of the Appellant, are

duly and in a legally valid manner stand transferred to Respondents 1 & 2

as on 05.07.2021 and therefore Respondents 1 & 2 are the recorded 100%

shareholders of the Appellant. It is the case of the Respondents that being

100% shareholders of the Appellant, they are entitled to control, manage

Company Appeal (AT) No. 91 of 2021 -6-

and run the affairs by electing their own nominees to the Board of Directors

of the Appellant. Learned Counsel for the Respondents argued that no

prejudice is caused to the Appellant by virtue of the Order dated 20.07.2021

passed by the NCLT directing the parties to maintain 'Status Quo' Qua the

assets and structures of shares of the Appellants.

7. We observe from the record that the Impugned Order dated

20.07.2021 does not refer to the Order of the Hon'ble High Court of Delhi

dated 19.07.2021 whereby and whereunder the Hon'ble High Court passed

an Order directing as follows:-

"7. Since these petitions are being heard on an urgent basis, this court considers it apposite to direct the parties to maintain status quo as to the shares of respondent no 4 company. Further, none of the parties shall exercise any rights in respect of the said shares.

8. It is clarified that the observations made in this order are tentative and should not be considered an expression of opinion (either prima facie or otherwise) determinative of any of the questions being considered, as noted above the petition is part heard and none of the parties are precluded from canvassing their contentions.

9. List on 20.07.2021."

(Emphasis Supplied)

8. It is seen from the record that the Respondent 'M/s. Creative Souls

Technology India Ltd.' has been restrained by the Hon'ble High Court of

Delhi in exercising any rights Qua such shares vide Order dated 19.07.2021

passed in OMP/1/COMM/213 of 2021. Learned Counsel for the Appellant

has also filed an Additional Affidavit with respect to the first Respondent

conducting Extraordinary General Meeting removing the existing Directors

and appointing its own Directors at the Board of the Appellant and

Company Appeal (AT) No. 91 of 2021 -7-

submitted that Contempt Proceedings were also being initiated before the

Hon'ble High Court of Delhi. We refrain from passing any observations

regarding the subsequent developments as it is not a subject matter before

us. Keeping in view, the factual matrix of the instant case and the fact that

Orders of the Hon'ble High Court of Delhi have not been placed before NCLT,

we are of the considered view that the Order be set aside and the matter be

remanded to NCLT and the same shall be decided by the Tribunal taking

into consideration all the Orders of the Hon'ble High Court of Delhi and shall

dispose of the Company Petition as expeditiously as practicable. To reiterate,

we have not made any observations on the merits of the matter. Both sides

shall appear before the NCLT on 08.11.2021

[Justice Anant Bijay Singh] Member (Judicial)

[Ms. Shreesha Merla] Member (Technical)

NEW DELHI 26th October, 2021

ha

Company Appeal (AT) No. 91 of 2021