Praveen Arya & Ors vs Anju Agarwal Insolvency Resolution ...

NATIONAL COMPANY LAW APPELLATE TRIBUNAL, PRINCIPAL BENCH, NEW DELHI Company Appeal (AT) (Insolvency) No. 40 of 2024 (Arising out of Order dated 30.10.2023 passed by the Adjudicating Authority (National Company Law Tribunal), Principal Bench in I.A. No.5253 of 2023 in CP No. (IB)-593(PB)/2018)

IN THE MATTER OF: Praveen Arya & Ors. ...Appellants Versus Anju Aggarwal (RP of Corporate Debtor ) & Anr. ...Respondents Present:

For Appellants : Mr. Gaurav Gupta, Ms. Nidhi Yadav, Advocates.

For Respondents : Mr. Abhishek Anand, Mr. Karan Kohli, Ms. Palak Kalra, Advocates for RP.

With Company Appeal (AT) (Insolvency) No.45 of 2024 & Interlocutory Application No.140 of 2024 (Arising out of Order dated 05.10.2023 passed by the Adjudicating Authority (National Company Law Tribunal), New Delhi, Principal Bench in I.A. No.5253 of 2023 in CP (IB) No.593(PB) of 2018)

IN THE MATTER OF: Praveen Arya & Ors. ...Appellants Versus Anju Aggarwal (RP of Corporate Debtor ) & Anr. ...Respondents

Present:

For Appellants : Mr. Gaurav Gupta, Ms. Nidhi Yadav, Advocates

For Respondents : Mr. Abhishek Anand, Mr. Karan Kohli, Ms. Palak Kalra, Advocates for RP. Mr. P. Nagesh, Sr. Advocate with Mr. Rishabh Jain, Advocate for SRA.

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 1 With Comp. App. (AT) (Ins) No. 61 of 2024 & I.A. No. 190 of 2024 (Arising out of Order dated 30.10.2023 passed by the Adjudicating Authority (National Company Law Tribunal), New Delhi, Principal Bench in I.A. No.3524 of 2020 in CP (IB) No.593(PB) of 2018)

IN THE MATTER OF: Nupur Garg ...Appellant Versus M/s IP Constructions Pvt. Ltd. (Through Resolution Professional) & Anr. ...Respondents Present:

For Appellant : Mr. Gaurav Mitra, Ms. Aishwarya Modi Seth, Mr. Jasmeet Singh and Mr. Pushpendra S. Bhadoriya, Mr. Vijay Sharma, Advocates.

For Respondent : Mr. Abhishek Anand, Mr. Karan Kohli, Ms. Palak Kalra, Advocates for RP. Mr. P. Nagesh, Sr. Advocate with Mr. Rishabh Jain, Advocate for SRA.

JUDGMENT

ASHOK BHUSHAN, J.

These three Appeal(s) arise of Corporate Insolvency Resolution

Process ("CIRP") of the same Corporate Debtor - M/s IP Construction Pvt.

Ltd. The Appellant(s) in these Appeal(s) are commercial 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

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 2 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

Adjudicating Authority in IA No.3524 of 2020 in C.P.(IB) No.593 (PB) of

2018. By IA No.3524 of 2020, the Appellant - Nupur Garg has prayed for

direction to exclude commercial space SF-05 from the Resolution Plan and

seeking a direction for execution and registration of Sale Deed in favour of

the Applicant in respect of commercial space/ office No.SF-05. By the

impugned order dated 30.10.2023, the IA was disposed of by the

Adjudicating Authority noticing that Applicant being a dissenting Financial

Creditor, is entitled to the minimum liquidation value. Successful

Resolution Applicant ("SRA") is willing to provide 100% of the principal

amount or alternative option as stated in the Resolution Plan for all the

commercial space buyers. Application was dismissed with the above

observations.

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 3

4. All the Appeal(s) having arisen out of similar facts and

circumstances, have been heard together and are being decided by this

common judgment.

5. Background facts necessary to be noticed for deciding the Appeal(s)

are:

(i) The Corporate Debtor - M/s IP Construction Pvt. Ltd., a real

estate company, involved in development of Project. The

Corporate Debtor ("CD") has issued an allotment letter dated

04.07.2012 in favour of Appellant in Company Appeal (AT)

(Ins.) Nos.40 and 45 of 2024, allotting the office spaces

Nos.GF-08, GF-09 and GF-10 on the ground floor, each

admeasuring 47.93 sq. mt. in the Project Coral Brio situated

at C5, Sector-18, Vasundhara, Ghaziabad.

(ii) Similarly, the Appellant in Company Appeal (AT) (Ins.) No.61

of 2024 was allotted Commercial space/ office Nos. SF-02, SF-

03 and F-05 vide allotment letter dated 31.03.2013. On

07.05.2014, Nupur Garg issued a letter to the CD requesting

cancellation of commercial spaces/ Office Nos. SF-02 and SF-

03 and sought refund of the booking amount. The Appellant

Nupur Garg also claimed that on 24.12.2014, Lease Deed was

executed between Nupur Garg and the CD regarding the Office

Space SF-05 with effect from 01.01.2015 for a period of nine

years on lease rent.

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 4

(iii) The CIRP against the Corporate Debtor commenced on an

application filed under Section 7 by the Union Bank of India.

The Adjudicating Authority vide order dated 11.01.2019

initiated the CIRP by admitting Section 7 application. On

15.01.2019, the IRP made public announcement.

(iv) The Appellant(s) in Company Appeal (AT) (Ins.) Nos.40 and 45

of 2024, filed their 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

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 5 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 No. SF-05 from the Resolution Plan

and seeking direction to execute a Sale Deed.

(vii) The Appellant of Company Appeal (AT) (Ins.) No.40 of 2024 also

filed an application - IA No.212 of 2022 and 765 of 2022, which

were withdrawn. An IA No.4369 of 2022 was filed by Appellant

of Company Appeal (AT) (Ins.) No.40 of 2024, seeking direction

to execute the Sale Deed in favour of commercial space allotted

to the Appellant and with respect to other issues pertaining to

the claim. IA No.4369 of 2022 was listed on several occasion

and on 30.08.2023 was dismissed for non-prosecution. An IA

No.5253 of 2023 was filed by the Appellant on 22.09.2023

praying for restoration of IA No.4369 of 2022. By an order

dated 05.10.2023, IA No.5253 of 2023 was disposed of by the

Adjudicating Authority As noted above, Company Appeal (AT)

(Ins.) No.45 of 2024 has been filed, challenging the order dated

05.10.2023, rejecting IA No.5253 of 2023 and Company

Appeal (AT) (Ins.) No.40 of 2024 has been filed challenging

order dated 30.10.2023, approving the Resolution Plan.

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 6

(viii) The Appellant - Nupur Garg has filed Company Appeal (AT)

(Ins.) No.61 of 2024 challenging the order dated 30.10.2023

passed in IA No.3524 of 2020.

6. Learned Counsel for the Appellants in Company Appeal (AT) (Ins.)

Nos.40 and 45 of 2024 submits that the Appellants being commercial space

buyers, who had paid substantial amount to the CD, were entitled for

execution of Sale Deed for commercial spaces. In the Resolution Plan the

claim of the Appellants for execution of the Deed has not been accepted

and there were initial proposed only 50% of principal amount in the

Resolution Plan. The commercial spaces, which were allotted to the

Appellants are commercial spaces, which are owned by the Appellants and

the Appellants were also handed over the possession of the commercial

spaces on 15.10.2017. The Appellants were required to pay the balance

amount on receipt of the completion certificate. Certain other commercial

space buyers have filed Company Appeal (AT) (Ins.) No.350 of 2020 -

Alok Sharma vs. M/s IP Construction Pvt. Ltd., where this Tribunal has

directed for execution of Sale Deed in favour of commercial space buyers,

after collecting dues and costs. It is submitted that case of the Appellant

is fully covered by the above judgment of this Tribunal. It is submitted that

the Appellants were entitled for commercial spaces, 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

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 7 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 the Appellant is also covered by the judgment

of this Tribunal in Alok Sharma's case.

8. Learned Counsel appearing for the RP refuting the submissions of

the Appellant(s), submit that the Appellants are commercial space buyers,

whose claims as Financial Creditor of a class, i.e., commercial space

buyers, were admitted in CIRP of the CD. List of creditors was issued,

including the admitted claim of both the Appellant(s). It is submitted that

Appellants in Company Appeal (AT) (Ins.) No.40 of 2024 have voting share

of 0.81%, whereas Appellant - Nupur Garg has voting share of 0.88%. Both

the Appellant(s) have voted against the Resolution Plan in the 13th CoC

meeting held on 16.01.2020. The Appellant(s) being dissenting Financial

Creditor have no right to challenge the Resolution Plan. The Plan having

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 8 been approved by majority by 87.49% vote shares, it is submitted that

Appellant(s) cannot claim the ownership over the commercial space allotted

to them. They were only allottees of the commercial space by the CD and

the ownership of the assets continued with the CD. The fact that both the

Appellant(s) in their application seeking direction to execute the Sale Deed

in their favour, itself proves that Appellant(s) are not the owner of the

premises. The Resolution Plan having been approved by majority by

87.49%, the Plan is binding on all stake holders of the CD, including the

Appellant(s). The Appellant(s) as dissenting Financial Creditors were

entitled to the liquidation value as per Section 30, sub-section (2). It is

submitted that IA, which was filed by the Appellant of Company Appeal

(AT) (Ins.) No.45 of 2024, being IA No.4369 of 2022 was listed for 11 times,

but it was never pressed or decided. No one appeared to press the

application, hence, it was rejected on 05.10.2023. The prayer of the

Appellant to restore the IA was rightly been rejected, since Plan approval

application was also heard and reserved on 05.10.2023. It is submitted

that the claim of the Appellant of Company Appeal (AT) (Ins.) No.40 of 2024

having been admitted, they are entitled for their claims as per the

Resolution Plan. They have no right to challenge the approval of Resolution

Plan. The Appeal(s) filed by the Appellant(s) deserve to be dismissed.

9. Learned Counsel for the SRA opposing the submissions of learned

Counsel for the Appellant(s) submits that the Appellant(s) being dissenting

Financial 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',

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 9 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. The ownership still lies with the CD,

since no Deed of Title has been executed in favour of the Appellant(s). The

judgment of this Tribunal in Alok Sharma's case (supra) was with respect

to only those Appellant(s), who were party to the Appeal and that benefit

cannot be claimed by the Appellant(s) in the present Appeal(s). The

Appellants' claim in the CIRP having been admitted and their claim having

been dealt in the Resolution Plan, they are entitled to receive the amount

as per the Resolution Plan. The allotment letter or lease for rental does not

transfer any ownership right in favour of the Appellant(s).

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 10

10. We have heard learned Counsel for the parties and have perused the

records.

11. From the submissions of learned Counsel for the parties and

materials on record, following questions arise for consideration in these

Appeal(s):

(I) Whether the units allotted to commercial space buyers (the

Appellant(s) herein), required to be excluded from the assets of

the Corporate Debtor?

(II) Whether the Appellant(s) on the basis of allotment of

commercial spaces by the CD, by virtue of Lease Deed dated

24.12.2014 in respect to Appellant - Nupur Garg, the

Appellant(s) are owners of the units allotted to them?

(III) Whether the Appellant(s) being dissenting Financial Creditors,

entitled for the amount as per Section 30, sub-section (2)(b)?

(IV) Whether the Appellant(s) had made sufficient grounds to

interfere with the order dated 30.10.2023 passed by the

Adjudicating Authority, approving the Resolution Plan

submitting by the SRA?

(V) Whether rejection of IA 3524 of 2020, filed by the Appellant of

Company Appeal (AT) (Ins.) No.61 of 2024 and the rejection of

IA No.4369 of 2022 and 5253 of 2023 filed by the Appellant(s)

of Company Appeal (AT) (Ins.) No.45 of 2024 deserve to be

interfered with?

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 11 Question Nos.(I) and (II)

12. Both the questions being interconnected are being taken together.

13. It is an admitted fact that Corporate Debtor has allotted commercial

space to the Appellants of Company Appeal (AT) (Ins.) Nos.40 and 45 of

2024 on 04.07.2012 as GF-08, GF-09 and GF-10 on the ground floor, each

measuring 47.93 sq. mt. in the Project Coral Brio. Similarly, SF-05, SF-2

and SF-3 on second floor have been allotted to Nupur Garg, Appellant in

Company Appeal (AT) (Ins.) No.61 of 2024 vide allotment letter dated

31.03.2013. The Appellant - Nupur Garg has also 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

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 12 directions to the CD through RP to execute a Sale Deed in favour of the

Appellant(s). The prayer by the Appellant(s) to execute a Sale Deed in their

favour, itself recognize that the title do not vest with the Appellant(s). The

law with regard to conveying a title is well settled. We may refer to the

judgment of the Hon'ble Supreme Court in (1977) 3 SCC 247 - Narandas

Karsondas vs. S.A. Kamtam and Anr., wherein following has been laid

down:

"A contract of sale does not itself create any interest in, or charge on, the property. This is expressly declared in s. 54 of the Transfer of Property Act. See Rambaran Prasad v. Ram Mohit Hazra & Ors. The fiduciary character of the personal obligation created by a contract for sale is recognized in section 3 of the Specific Relief Act, 1963 and in section 91 of the Trusts Act. The personal obligation created by a contract of sale is described in section 40 of the Transfer of Property Act as an obligation arising out of contract and annexed to the ownership of property, but not amounting to , an interest or easement therein."

14. Another judgment, which need reference is judgment of the Hon'ble

Supreme Court in Suraj Lamp and Industries Pvt. Ltd. vs. State of

Haryana & Ors. - AIR 2012 206, wherein in paragraphs 18 and 19,

following have been laid down:

"18. It is thus clear that a transfer of immovable property by way of sale can only be by a deed of conveyance (sale deed). In the absence of a deed of conveyance (duly stamped and registered as required by law), no right, title or interest in an immovable property can be transferred.

19. Any contract of sale (agreement to sell) which is not a registered deed of conveyance (deed of sale) would fall short of the requirements of Sections 54 and 55 of the TP Act and will not confer any title nor

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 13 transfer any interest in an immovable property (except to the limited right granted under Section 53-A of the TP Act). According to the TP Act, an agreement of sale, whether with possession or without possession, is not a conveyance. Section 54 of the TP Act enacts that sale of immovable property can be made only by a registered instrument and an agreement of sale does not create any interest or charge on its subject-matter."

15. The Hon'ble Supreme Court had occasion to consider a homebuyer's

project in Jaypee Kensingston Boulevard Apartment Welfare

Association & ors. Vs. NBCC (India) Ltd. & Ors. - (2022) 1 SCC 401,

where Hon'ble Supreme Court has held that Resolution Plan has to

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 IP Construction Pvt. Ltd. It is contended that

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 14 this Tribunal has set aside the order of NCLT dismissing CA No. 2265

(PB)/2019 in CP (IB) No.593(PB)/2018 filed by similarly placed commercial

space buyers, which Appeal was also filed by a commercial space buyer,

where this Tribunal has allowed the Appeal and directed for execution of

Sale Deed in their favour. Learned Counsel for the Appellant has relied on

directions issued by this Appellate Tribunal in the aforesaid Appeal.

Reliance has been placed in directions (m), where this Tribunal directed

following:

"m. Hence, in view of the above observations, this `Appellate Tribunal' is not in a position to sustain the order of the `Adjudicating Authority' and accordingly, this `Tribunal' sets aside the impugned order dated 16.01.2020, dismissing CA No.2265/(PB)/2019 in CP(IB) 593 of 2018 and directs the `Resolution Professional' to execute the sale deed after collecting `Dues and Costs', if any, remaining unpaid, including the `Costs of Registration', `Penalty' and `other incidental Costs', till date, etc.

The instant `Appeal' is allowed with the above observations. Pending application, if any, stands disposed of. Interim order, if any, passed by this `Tribunal' stands vacated.

No order as to costs."

17. The above direction, which was issued by this Appellate Tribunal was

with respect to 12 spaces of commercial space buyers, who had filed the

Appeal and who had filed the CA giving rise to the Appeal. In the above

case, this Tribunal observed that "Hence, we are unable to sustain the views

of Respondent/ RP that these houses registration will violate 'Moratorium'

under Section 14 of the Code". After taking the aforesaid view, the direction

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 15 was issued to execute the Sale Deed after collecting dues and costs. The

above order has to confine to the Appellant, who had filed the Appeal. The

above order at best can be held to lay down ratio that moratorium under

Section 14, does not prohibit execution of Sale Deed, but the said judgment

itself cannot be held to declare that unit allottees are the owners of units

allotted to them.

18. We, thus, are of the view that by virtue of allotment of commercial

space in favour of the Appellant(s), including the Lease Deed dated

24.12.2014 in favour of Nupur Garg, the Appellant(s) cannot claim to have

become owners of the commercial spaces. The CD continues to own the

assets 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:

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 16

Particulars Number Claim Received Claim Voting of (Rs.) Admitted (Rs.) Share% Claims Secured Financial 1 43,69,66,133.85 43,69,66,133.85 44.20 Creditor- Union Bank of India

Unsecured 1 4,47,97,500 4,47,97,500 4.43 Financial Creditor-

Baba Agribuild Private Limited

Financial 20 13,52,31,482.84 11,39,06,557.83 12.51 Creditors- In case of Commercial Space Buyers

Financial 40 21,15,42,755.82 19,47,73,637.88 18.28 Creditors- In class of Service Apartment

Financial 47 24,72,64,384 17,83,86,354 20.58 Creditors- In class of Secured Service Apartment

Total 109 1,07,58,02,256.51 96,78,30,183.56 100

20. The Financial Creditors in class of commercial space buyers, who

collectively have 12.51% vote share have voted against the Plan. In

paragraph 3.10 of the impugned order, the Adjudicating Authority has

noted vote shares and the manner of voting by each creditor. Paragraph

3.10 is as follows:

"3.10. Therefore, the resolution Plan of Manish Bansal (Group of individuals) was approved with 87.49% of voting share and the voting was as follows:

Particulars Voting Share% Voting for resolution plan Secured Financial Creditor- 44.20 Voted For Union Bank of India

Unsecured Financial Creditor- 4.43 Voted For Baba Agribuild Private Limited

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 17 Financial Creditors- In case of 12.51 Dissented Commercial Space Buyers

Financial Creditors- In class 18.28 Voted For of Service Apartment

Financial Creditors- In class 20.58 Voted For of Secured Service Apartment

Total 100

21. A perusal of result of voting on Resolution Plan, indicate that

Financial Creditors in case of commercial space buyers have dissented. The

Appellant(s) are also part of Financial Creditors in class of commercial

space buyers. Financial Creditors being a dissenting Financial Creditors

are entitled as per Section 30, sub-section (2) sub-clause (b), which is as

follows:

"30(2)(b) provides for the payment of debts of operational creditors in such manner as may be specified by the Board which shall not be less than-

(i) the amount to be paid to such creditors in the event of a liquidation of the corporate debtor under section 53; or

(ii) the amount that would have been paid to such creditors, if the amount to be distributed under the resolution plan had been distributed in accordance with the order of priority in sub-section (1) of section 53,

whichever is higher, and provides for the payment of debts of financial creditors, who do not vote in favour of the resolution plan, in such manner as may be specified by the Board, which shall not be less than the amount to be paid to such creditors in accordance with sub-section (1) of section 53 in the event of a liquidation of the corporate debtor.

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 18 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 of the Corporate Debtor.

When we look into the total plan value offered by SRA and compare with

the amount, which is admitted with regard to Financial Creditors - secured

and unsecured, the liquidation value of the unsecured Financial Creditors

in a class of commercial space buyers is 'zero'. In the Resolution Plan,

which was submitted by SRA, the SRA has offered to pay 50% of the

principal amount to the Financial Creditors in case of commercial space

buyers. The Adjudicating Authority, however, in the impugned order has

noted the revised proposal given by SRA on 04.10.2023, offering 100%

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 19 refund of the principal amount and alternative proposal for commercial

space buyers was also given in the Resolution Plan by the Resolution

Applicant. In paragraph 11.4 of the impugned order, the Adjudicating

Authority has noted the offer of the SRA paying 100% of admitted amount

within 90 days or an alternate option provided to opt for commercial space

project. Paragraph 11.4 of the judgment is as follows:

"11.4. Further the revised treatment in the Resolution Plan for the all commercial space buyers is given by the SRA in which they will be paid 100% of their admitted amount within 90 days or an alternative option is also provided to opt for commercial space possession with registered sale deed in terms of new offer rate and adjustment of 100% of the paid principal."

23. Alternate option for commercial space buyers has also been extracted

by Adjudicating Authority, in paragraph 4.4, which is part of the Resolution

Plan. Paragraph 4.4 of the impugned order is as follows:

"Alternate option for commercial space buyer:

Alternative option for commercial space buyer Possession with registered sale deed New Tariff & Offer Rate (Per sq. ft. of super area) Floor New Defer Rate for Adjustment of Money Tariff Commercial Already Paid General Allottees Ground 18,000 16,000 100% of the principal amount paid shall be First 14,000 12,000 adjusted against total value of commercial space Second 11,000 9,000 opted.

Offer Conditionality:

1) Offer includes relocation of existing space within the option of available space.

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 20 2) No guarantee to continue with the existing space. Kindly check for new model plan for commercial space. So far as it shall be possible & commercially feasible, existing space may also be offered.

3) Old Agreement/ 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 Plan is only to examine as to whether

the Resolution Plan is in compliance of Section 30, sub-section (2) of the

IBC. The present is not a case that Appellant(s) have pleaded or proved

any ground that Resolution Plan is in violation of provisions of Section 30,

sub-section (2) (b). We have already found that payment offered to the

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 21 Appellant(s) in the Resolution Plan, does not violate the provisions of

Section 30, sub-section (2) (b). We, thus, do not find any ground to interfere

with the order dated 30.10.2023 passed by Adjudicating Authority

approving the Resolution Plan. The question is answered accordingly.

Question No.(V)

26. Now, we come to IA No.3524 of 2020, which was filed by Nupur Garg,

Appellant in Company Appeal (AT) (Ins.) No.61 of 2024. The prayers, which

were made in the application have been quoted by the Adjudicating

Authority in paragraph 11 of the order, which are as follows:

"11. IA 3524/2020

1. The Applicant namely, Nupur Garg being one of the commercial space buyers has sought the following reliefs in the present Application :-

i. Pass appropriate directions to exclude commercial space/office No. SF-05 from the Resolution Plan that has been approved by the CoC on 30.01.20 by relying on the incorrect information memorandum prepared by the Resolution Professional.

ii. Pass appropriate directions for execution and registration of sale Deed in favour of the Applicant in respect of commercial space/office No. SF-05.

iii. Pass appropriate directions to suitably modify the approved claim of the Applicant to include outstanding rent amount which became accrued and due of Rs. 20,69,552/- as the principal/basic amount of the claim.

iv. Pass appropriate directions for payment of legitimate outstanding rental dues starting from July 2019 till date, cumulatively amounting to Rs. 6,64,132/- (Six Lakhs Sixty-

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 22 Four Thousand One hundred and thirty-two) along with interest @ 18 p.a compounded quarterly on the unpaid rent, on account of lease of commercial space/office No. SF-05 to the Corporate Debtor by the Applicant.

v. Pass appropriate directions to take action remedial measure against the RP, including initiation of disciplinary action, if any, as deemed fit.

vi. Any other order that this Hon'ble Tribunal may deem fit in the facts and circumstances of this case."

27. In view of what we have held above, we are of the 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:

Service Tax Claimed as Principal not approved.

Interest approved 4,40 43,66, 44,00, 43,12 0. from may 15, 2014 Nupur 87,66,3 87,12, 17 0,00. 395.0 000.0 ,516. 88 from the agreed Garg 95.00 516.27 00 0 0 27 % date of interest Rent and Interest on Rent is pending as the same is not reflecting in books.

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 23 Ravi kant Dwivedi, Naresh 57,8 26,73, 56,93, 23,57 8,455,0 80,51,5 0.81 21 Singh 1,46 639.0 704.0 ,873. 99,00 77.89 % Yadav 0.00 0 0 89 and Praveen Arya

28. The Appellant - Nupur Garg has also pleaded that after

commencement of the insolvency, she was paid rent upto June 2019 by

the RP and hence, from the prayers made in the application IA No.3524 of

2020, it is clear that Appellant has prayed for payment of rent only with

effect from July 2019. In the order passed by the Adjudicating Authority

dated 30.10.2023 by which IA No.3524 of 2020 has been rejected, there is

no consideration of the prayer No.(iv), as claimed in IA No.3524 of 2020.

The claims, which were admitted pertained to the claim of the Appellant

upto the date of commencement of the CIRP. There has been no

consideration of the claim of the rent by the Appellant from July 2019,

which was one of the prayers made in the application, we are of the view

that ends of justice will be served in granting liberty to the Appellant -

Nupur Garg to file an appropriate application for claim of rent subsequent

to commencement of CIRP. It shall also be open for the Appellant to claim

the said rent as CIRP cost. However, we are not expressing any concluded

opinion for the said claim and it is for the Adjudicating Authority to

consider and take appropriate decision.

29. We, thus upheld the order of the Adjudicating Authority passed in IA

No.3524 of 2020, subject to liberty granted to the Appellant - Nupur Garg

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 24 to file fresh application with regard to prayer (iv), which has not been

adverted to and decided in the impugned order.

30. Coming to the IA, which was filed by the Appellant in Company

Appeal (AT) (Ins.) Nos.40 and 45 of 2024, is the Application, which was

earlier filed being IA No.4369 of 2022. The Appellant has prayed for

direction to execute the Sale Deed and certain issue with regard to claims.

The claims of the Appellant has been admitted by RP, which is reflected in

the List of Creditors as noted above. The claim of the Appellant, prior to

CIRP, thus, become final. Although, IA No.4369 of 2022 was dismissed for

non-prosecution and IA No.5253 of 2023 was dismissed on the ground that

the matter has progressed too far. The RP in his reply to the Appeal has

stated that IA No.4369 of 2022 was listed 11 times and IA No.5253 was

listed 8 times. In any view of the matter, the application for recall of the

order was not accepted by Adjudicating Authority on the ground that Plan

approval has already been reserved.

31. We, thus, do not find any ground to interfere with the order dated

05.10.2023 passed by Adjudicating Authority in IA No. 5253 of 2023. More

so, in view of our reasons and discussions and what was claimed by the

Appellant in IA 4369 of 2022 has already been considered and for the

reasons given above, no direction for execution of the Sale Deed in favour

of the Appellants in Company Appeal (AT) (Ins.) No.40 of 2024 could be

issued. We, thus, do not find any ground to interfere with the order dated

05.10.2023 passed by Adjudicating Authority in IA No.5253 of 2023.

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 25

32. In view of the above reasons and conclusions, we dispose of the

Appeal(s) in following manner:

(I) Company Appeal (AT) (Ins.) No.40 of 2024 is dismissed

upholding the order dated 30.10.2023 passed by Adjudicating

Authority approving the Resolution Plan.

(II) Company Appeal (AT) (Ins.) No.45 of 2024 is dismissed.

(III) Company Appeal (AT) (Ins.) No.61 of 2024 is disposed of

upholding the order dated 30.10.2023 passed by Adjudicating

Authority in IA No.3524 of 2020, subject to liberty granted to

the Appellant - Nupur Garg to file fresh application before the

Adjudicating Authority for prayer (iv) made in IA 3524 of 2020,

i.e. claim of the Appellant for lease rent from July 2019.

All pending IAs, if any, are also disposed of. Parties shall bear their

own costs.

[Justice Ashok Bhushan] Chairperson

[Barun Mitra] Member (Technical)

NEW DELHI

21st November, 2024

Ashwani

Comp. App. (AT) (Ins) Nos. 40, 45 & 61 of 2024 26