TMI Blog2022 (7) TMI 1071X X X X Extracts X X X X X X X X Extracts X X X X ..... was to be filed in the Hon ble Supreme Court. Learned Counsel for the Appellant submitted that the Resolution Plan with regard to group entities of Unitech are also being filed before the Hon ble Supreme Court which is under consideration. There are no doubt that the Appellant is an affiliate of Unitech Group and Moratorium imposed by the Hon ble Supreme Court by order dated 20.01.2020 as clarified by further order dated 24.03.2021 was applicable on the Appellant who was also entitled for the benefit of the said orders. Learned Adjudicating Authority committed error in holding that orders dated 20.01.2020 and 24.03.2021 are not applicable to the Appellant who is a joint venture of Unitech Holdings Limited. The new Board of Directors of Unitech Limited has also taken steps for appointment of Nominee Directors of Board of Directors of the Appellant - the order dated 06.04.2022 passed by the Adjudicating Authority in I.A No. 5608 of 2021 cannot be sustained and is set aside. Section 7 Application filed by the Respondent stands adjourned sine die till the currency of Moratorium as imposed by the orders of the Hon ble Supreme Court dated 20.01.2021 and 24.03.2021. - Company Appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g of Unitech Holdings Limited. It is submitted that under the orders of the Hon ble Supreme Court, Board of Directors of Unitech Limited has appointed Directors in the Appellant Company. The Board of Directors of Unitech Limited has control over the Appellant, hence, the Moratorium was fully attracted and the Adjudicating Authority committed error in holding that the Appellant having failed to prove that it is a subsidiary of Unitech Holdings Limited has rejected the Application. It is submitted that the Adjudicating Authority has also committed error in observing that the Corporate Debtor has failed to present that new Board of Unitech Limited has taken over the management and control of the Corporate Debtor. It is submitted that in compliance of order of Hon ble Supreme Court, Unitech Limited has nominated two Directors on behalf of the Unitech Holdings Limited, a wholly owned subsidiary of Unitech Limited, vide a Resolution dated 16.04.2021 which clearly proves that Unitech Holdings Limited exercises its control over the Appellant and is also entitled for the benefit of Moratorium. 3. Learned Counsel for the Respondents refuting the submissions of the Appellant supports the o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (1) The new Board shall be responsible for the management and control of the Unitech Group (including all its affiliates, trusts, subsidiaries etc.). The Order passed by this Court dated 20 January 2020 is applicable to all group entities of Unitech Ltd. The management is authorized to appoint and remove Directors/ Trustees of its subsidiaries/ trusts etc. 7. In the Application which was filed by the Appellant before the Adjudicating Authority, it was contended that by virtue of Moratorium as imposed by the Hon ble Supreme Court orders dated 20.01.2020 and 24.03.2021, Section 7 Application filed against the Appellant which is a joint venture of Unitech Holdings Limited cannot proceed and Section 7 Application was deserved to be adjourned sine die due to Moratorium imposed by the Hon ble Supreme Court. 8. The said Application has been rejected taking the view that Appellant is not entitled to the benefit of Moratorium and the Moratorium is not applicable on the Appellant. The subsequent order of the Hon ble Supreme Court dated 24.03.2021 makes it clear that the Moratorium dated 20.01.2020 is applicable on Unitech Group (including all its affiliates, trusts, subsidiaries ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Company. 10. The order of the Hon ble Supreme Court referred to expression including all its affiliates, trusts, subsidiaries etc. The earlier order dated 20.01.2020 had mentioned Unitech Limited and its subsidiaries. Appellant cannot claim to be subsidiary of Unitech Limited rather it claims to be affiliate of Unitech Group. Appellant has brought on the record the Shares Subscription-cum-Shareholders Agreement between several parties which including Unitech Limited, Unitech Holdings Limited, International Amusement Limited where different expressions have been defined. In paragraph 1 which deals with Definitions and Interpretation Affiliate has been defined in following words:- Affiliate means in relation to any party, (i) any person that directly or indirectly Controls, is Controlled by, such party; or (ii) any person, the legal and beneficial ownership of at least 26% of which is directly or indirectly held (including through one or more persons) collectively or severally by such party; (iii) any trust in respect of which such party is a direct or indirect a beneficiary; and (iv) in the case of a natural person, any Relative of such person. Control or Cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es of Unitech are also being filed before the Hon ble Supreme Court which is under consideration. Learned Counsel for the Appellant has brought on record Minutes of Meeting of the New Board of Directors of Unitech Limited held on 27.04.2022 which indicate that Appellant has been clearly mentioned as affiliate of Unitech Group and project of the Appellant has also been captured in the minutes. Learned Counsel for the Appellant has referred to paragraph 8.1 of the minutes where Appellant has mentioned as affiliate of Unitech Group. 13. In view of the above, we have no doubt that the Appellant is an affiliate of Unitech Group and Moratorium imposed by the Hon ble Supreme Court by order dated 20.01.2020 as clarified by further order dated 24.03.2021 was applicable on the Appellant who was also entitled for the benefit of the said orders. Learned Adjudicating Authority committed error in holding that orders dated 20.01.2020 and 24.03.2021 are not applicable to the Appellant who is a joint venture of Unitech Holdings Limited. The new Board of Directors of Unitech Limited has also taken steps for appointment of Nominee Directors of Board of Directors of the Appellant as noted above. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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