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2022 (3) TMI 600 - AT - Insolvency and BankruptcyCIRP - Resolution process - Right of Noida Authority over leased assets - contention of appellant is that prior approval from the lessor has not been taken before sub-leasing portion of the land to the ‘Corporate Debtor’ for development of the Housing Project - appellant were ignorant of existence of the said JDA, GPA and Agreement to sell - HELD THAT:- The CONSTRUCTION Clause under the Lease Deed provides that the construction shall be as per the Building Plans approved by the Appellant/NOIDA. It is based on the Lease Deed, of M/s. Logix. The ‘Corporate Debtor’ has entered into the said JDA, whereby the development rights and other privileges over the said Project premises has been transferred by M/s. Logix in favour of the ‘Corporate Debtor’. As regarding the contention of the Appellant that NOIDA is completely unaware of the said Project and any sort of construction activity going on, is untenable specially in the light of Annexure R-3 which refers to the Project namely i.e., ‘Victory Ace’, the Registration Date being 18/03/2019 and the ‘signing Competent Authority’ being ‘NOIDA Authority’. It is seen that the Appellant/NOIDA had extended permissions for the Building Plans; that the Project ‘Victory Ace’ is registered under UPRERA which establishes that all copies of approvals and Commencement Certificate from the Competent Authority were submitted in compliance of Section 4(2) of RERA Act, 2016. Keeping in view these reasons, the stand taken by the Appellant that they were not in knowledge of the Group Housing Scheme at Plot H-02, Sector 143 NOIDA, is unsustainable. JDA is a valid contract in the eyes of law or not? - HELD THAT:- The material on record establishes that all details of the Project were in public domain and therefore the stand of the Appellant that they had absolutely no knowledge about the Project, holds no water. It is also seen from the record that the Project commencement date was 2012 and the completion date was 2019. There is no documentary evidence filed by the Appellant showing any sort of objection raised by them for this 7 year period - A perusal of the JDA shows that the Agreement only creates development rights in favour of the ‘Corporate Debtor’ which is authorised by a GPA to carry out construction and sale of the flats. There is no leasehold interest created in favour of the ‘Corporate Debtor’. There is no Clause in the Lease Deed which prevents M/s. Logix from transferring development rights or creating a sub-lease right to a third party. It is the case of the Appellant that the aforenoted JDA describes M/s. Logix as the ‘Owner’ which is illegal. A careful reading of the JDA shows that the Appellant/NOIDA is shown as ‘the sole owner’ of Plot No. GH-02. A comprehensive reading of all the terms and conditions show that pursuant to the registered Lease Deed dated 08/06/2011 leasehold rights were granted to M/s. Logix and it is clearly stated in the JDA that it considers itself the ‘sole lessee’ of the plot. The JDA read with the Allotment Letter and the Builder Buyer Agreement further strengthens the case of M/s. Logix that both M/s. Logix and the ‘Corporate Debtor’ have clearly repeated that the ‘NOIDA is the Owner of the Project land’ and M/s. Logix is only a ‘lessee of the plot’ - this Tribunal is of the earnest view that the issue raised by the Appellant regarding the usage of the word ‘Owner’ with reference to M/s. Logix in the JDA, is misconceived. Having accepted the lease premium amounts towards lease premium and lease rentals under the Lease Deed and benefited therefrom, the Appellant cannot now turn around and say that they are completely unaware of the Project or that the JDA is non-est in the eyes of the law. There are no substantial reasons given by the Appellant to have not exercised their rights to cancel the Lease Deed in view of their stand that M/s. Logix had sub-leased the property without their approval and in contravention of Clause 5 of the Lease Deed. Clause No. 12 clearly mentions that the lessee/sub-lessee shall not be allowed to change his role otherwise the lease/sub-lease can be cancelled and the entire amount deposited shall be forfeited - It is beyond comprehension as to how the Appellant/NOIDA could have overlooked this factual scenario for 7 long years, having approved the Building Plans, having accepted the premium amounts and the lease rentals and now at this stage of CIRP, stating that they were completely unaware of any such Housing Project coming up, is completely untenable. The ‘development rights’ construe ‘Property’ of the ‘Corporate Debtor’ and hence the Resolution Professional has duly performed his duties as per Section 18(1)(a)(iii) and has taken control and custody of the assets of the ‘Corporate Debtor’ mentioned in the Balance Sheet in compliance of the provisions of Section 18(1)(f) and resultantly there are no deficiency of service on behalf of the RP. The appeal is dismissed.
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