M/S. Cis Infrastructure Llp & Anr vs Mr. Ashok Kumar Gupta

CIS Infrastructure LLP & Anr. ...Appellant Versus Ashok Kumar Gupta ...Respondents RP of Andes Town Planners Pvt. Ltd. & Anr.

Present: For Appellant : Counsel appeared but presence not marked.

For Respondents : Mr. Utsav Mukherjee, Mr. Mayukh Roy, Advocates for R1 along with Mr. Ashok Gupta, RP in person. Mr. Sandeep Bhuraria and Ms. Vatsala Pandey, Advocates for R2. Mr. Abhishek Anand, Mr. Karan Kohli and Ms. Palak Kalra, Advocates.

ORDER

(Hybrid Mode)

27.05.2025 : The CIRP was initiated against M/s Andes Town Planners

Pvt. Ltd. on 02.03.2023. On admission of CIRP the Respondent No.1 herein

was appointed as IRP. The Corporate Debtor was an owner of a certain

property which was being developed into a building complex comprising of

both commercial and residential portions. The Respondent No.2 is a

Developer to whom the Respondent no.1. Corporate Debtor had entrusted the

developments rights under certain agreements entered into by them.

2. The applicant herein claims that he had entered into an agreement to

buy as many as 16 residential units in "Ananta Towers" of which he had

obtained sale deeds for 13 units. The IRP, the first respondent herein, has

taken out certain application under Section 66 of IBC before the Adjudicating Authority to declare those sales to be fraudulent on the allegation that they

were undervalued and this application pending consideration by the

Adjudicating Authority.

3. In the meantime, IRP has issued public notices and in response to

which present applicant is paid to have made his claims. As earlier indicated,

the entertainability of this claims perhaps will depend on the outcome of the

petition filed by the appellant under Section 66. The issue here, however,

relate to none of the above. The Respondent no.2 who this Tribunal wish to

termed as developer for convenience, has approached the Lucknow

Development Authority ('LDA' for short) sometime before 2019 for conversion

of the building complex "Ananta" into a full-fledged commercial complex. Be

that as it may, the respondent no.1 as well as respondent no.2 took out

applications before the NCLT in IA No. 3739 of 2023 and IA No. 5252 of 2023.

The Respondent no.1 in his application inter alia sought a direction from

Adjudicating Authority to stop the Respondent No.2 from going ahead with

the construction. Alongside the Respondent no.1 had issued a letter dated

21.06.2023 to the LDA not to grant any approval to the Developer for

conversion of the character of the building as was originally approved and not

to sanction or approve any further plans in respect of "Ananta Residency".

The Respondent No.2 would now take out an application in IA No. 5252 of

2023 requiring a direction from the Adjudicating Authority to the respondent

no.1 to withdraw such letter issue by him to LDA.

2 of 6 I.A. No. 2938 of 2025 in Company Appeal (AT) (Ins) No. 266 of 2025

4. These two Interlocutory Applications along with another was taken for

hearing by the Adjudicating Authority and in its order dated 17.12.2024

passed the following order:

"41. In view of the above, the Application bearing IA-3739/2023 is accordingly dismissed. No order as to costs.

42. IA-5252/2023:

i. In this application, the Applicant has prayed to: (a) direct the Respondent to withdraw the letter dated 21.06.2023 sent to Lucknow Development Authority (LDA), (b) to direct the Respondent to continue the business of the Corporate Debtor as a going concern, (c) restrain the Respondent from creating hindrances in completion of the Construction of the project and

(d) to direct the IBBI to initiate the disciplinary proceedings against the Respondent.

ii. In IA-3739/2023, we have held that the Applicant/M/s. Halwasiya Developments Private Limited (Respondent in IA3739/2023) has the development rights by virtue of the Development Management Agreement dated 19.01.2018, Power of Attorney dated 19.01.2018 and Consortium Agreement dated 05.09.2020 and further in view of the law laid down by the Hon9ble NCLAT in the case of K.H. Khan and Anr. (supra) and the Hon9ble Supreme Court in Victory Iron Works Ltd. (supra) the Applicant has a right to develop the property in question.

iii. Therefore, we direct the Respondent/Resolution Professional not to create any hindrance in the completion of the construction of the project i.e. "ANANTA Residences" by the Applicant/M/s. Halwasiya Developments Private Limited.

iv. Accordingly, the prayer to the above extent is allowed in IA5252/2023."

3 of 6 I.A. No. 2938 of 2025 in Company Appeal (AT) (Ins) No. 266 of 2025

5. In effect the Respondent no.1 efforts to stop further construction was

stopped. This order was challenged by Respondent No.1 in an appeal which

is now pending before this Tribunal. The said order of the Adjudicating

Authority is also being challenged by multiple persons including the present

applicant.

6. The grievance of the applicant is that in asmuch as they had purchased

some 13 apartments outright from the corporate debtor and had also invested

money for purchase of another three units, any alteration to the character of

the property would affect its vested right. On obtaining some information that

the Respondent no.2 had approached the LDA for conversion of the original

building plan, the appellant approached the Lucknow Bench of the Allahabad

High Court in Writ Civil No. 7105 of 2022. The High Court vide its order dated

11.10.2022 has disposed of the matter with a direction to hear the appellant

herein by the LDA. Since nothing was heard from LDA, the appellant herein

taken out the petition to initiate an action for contempt. In this petition a

statement was made by the counsel for LDA which read as below at page-

1411 in paragraph-4:

"4. Shri Chandra informs that there is a legal impediment that as N.C.L.T., New Delhi has passed an order dated 02.03.2024, no decision can be taken in the case of the applicant."

The order to which a reference was made in the statement of the counsel for

the LDA appears to be the order of the Adjudicating Authority dated

02.03.2023, admitting the CIRP.

4 of 6 I.A. No. 2938 of 2025 in Company Appeal (AT) (Ins) No. 266 of 2025

7. Now the LDA has issued a notice dated 22.04.2025 to the appellant to

participate in some hearing. The counsel for the applicant informs that to the

extent appellant has knowledge no decision on it has been taken by LDA.

8. The counsel for the respondent no.1, the RP, submits that inasmuch as

he was an applicant in IA No. 3739 of 2023 and inasmuch as under a

statutory duty to take custody of the assets of the corporate debtor it is

imperative that he was heard by the LDA but he was not so heard. He also

added that the agreement under which the respondent no.2 purport to

develop the property is also under challenge before the Adjudicating

Authority.

9. Refuting the submission of both counsel, the counsel for respondent

no.2 submitted that respondent no.2 had made an application for conversion

even in 2019, that on 07.12.2021 it was approved by the LDA but the

approved plans were not released to the respondent no.2 for couple of reasons.

One of the reason appears to be that certain amounts which are required to

be paid by the respondent no.2 was not paid but it has subsequently been

paid in August 2022, and therefore there is hardly anything that is required

to be done by the LDA except delivering the approved plans now approved by

the proceeding dated 07.12.2021 to the respondent no.2. He added that the

statement made by the counsel for LDA before the High Court, set in the

context, may not be a correct statement.

10. The present appeal, in our opinion, is slightly alien to the scope of the

appeal which parties have filed challenging the order of the Adjudicating

5 of 6 I.A. No. 2938 of 2025 in Company Appeal (AT) (Ins) No. 266 of 2025 Authority dated 17.12.2024. The LDA is a statutory authority and what it

ought to do it has to do, and this Tribunal may not interfere with it. The

anxiety of the Tribunal is limited to the extent of ensuring that there is no

depletion to the value assets of the corporate debtor since these assets are

essential for bringing the CIRP to a logical conclusion. Whereas the counsel

for the respondent no.2 makes a statement that sanction on his application

for conversion of character of "Ananta Residency" has been approved even as

in 07.12.2021, the LDA still has issued notices to the appellant. This Tribunal

is not inclined to enter into the object and the purpose behind the notice of

the LDA. However, since notice has been issued by a statutory body the

appellant necessarily has the right of participation in it.

11. However, this Tribunal considers that before LDA comes out with its

decision on the proceedings it is only required to give a hearing to the

respondent no.1, the RP. As to the rest this court does intend to enter to

embark into any enquiry. Needless to state that the LDA being a statutory

authority is required to decide the issue in accordance with law.

12. Accordingly, I.A. No. 2938 of 2025 stands disposed of.

[Justice N. Sesha Sayee] Member (Judicial)

[Barun Mitra] Member (Technical) harleen/NN

6 of 6 I.A. No. 2938 of 2025 in Company Appeal (AT) (Ins) No. 266 of 2025