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TMI Blog2020 (3) TMI 34X X X X Extracts X X X X X X X X Extracts X X X X ..... as 'the MHADA') to execute a joint development agreement with the Corporate Debtor, i.e. Guru Ashish Construction Private Limited, and Goregaon Siddharth Nagar Sahakar Griha Nirman Sanstha Limited (a Society for persons who are displaced and who are to be rehoused in the project for joint development of land, ad- measuring about 40 acres), which envisaged re-development insofar as 672 tenements in Siddharth Nagar, Goregaon, Mumbai were concerned. ii. On 03.03.2008, the Maharashtra State Government granted its approval to the aforesaid Resolution. iii. On 10.04.2008, a Tripartite Joint Development Agreement (hereinafter referred to as the "Joint Development Agreement") was entered into between the Society representing persons occupying 672 tenements, MHADA and the Corporate Debtor. iv. On 25.03.2011, a Loan Agreement was entered into and executed between the Union Bank of India and the Corporate Debtor for a sum of Rs. 200 Crores. v. On 09.11.2011, a Deed of Modification was entered into between the three parties to the Joint Development Agreement, as after carrying out the survey of the land in question, it was found that certain parcels of land, which were identified ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al and allowed the entire 55 days so taken before the NCLT to be excluded. xi. On 03.07.2018, the Appellant filed an approved Resolution Plan before the NCLT, Mumbai by way of I.A. No.21433 of 2018. We are informed that this was within the extended period of 55 days so granted by the NCLAT. It may only be mentioned that the Resolution Plan was approved by 86.16% of the Committee of Creditors. Ultimately, the NCLAT, by the impugned order dated 14.12.2018, (after omitting to refer to the order dated 09.05.2018), stated that 270 days are over, as a result of which the entire discussion of Section 14(1)(d) would now become academic. However, it also decided: "14. On perusal of record, we find that pursuant to the 'Joint Development Agreement' the land of the 'Maharashtra Housing and Area Development Authority' was handed over to the 'Corporate Debtor' and 'except for development work' the 'Corporate Debtor' has not accrued any right over the land in question. The land belongs to the 'Maharashtra Housing and Area Development Authority' which has not formally transferred it in favour of the 'Corporate Debtor'. Hence, it cannot be treated to be the asset of the 'Corporate Debtor' fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his arguments. 3. Mr. Dushyant Dave, learned Senior Advocate appearing on behalf of MHADA, painstakingly took us through the various provisions of the Maharashtra Housing and Area Development Act, 1976 (hereinafter referred to as the "MHADA Act"). He relied, in particular, upon the various clauses in the preamble and then referred to Sections 4, 5, 37, 66 and 74 and relied strongly upon Sections 76 and 79 of the MHADA Act to argue that joint development schemes that the Authorities concerned enter into with the builders must first be with the previous approval of the Authority, and such schemes have to be executed under the supervision of the Authority. This being the case, according to him, there is no question of any possession or occupation being handed over and, as a result, Section 14(1)(d) of the Code would not apply. He also strongly relied upon a recent judgment by my brother S. Ravindra Bhat, J. in Municipal Corporation of Greater Mumbai (MCGM) vs. Abhilash Lal & Ors. (Civil Appeal No. 6350 of 2019), to buttress his proposition that Section 238 of the Code, which contains a non- obstante clause getting out of harm's way other statutes, cannot be extended beyond the prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment of Security Interest Act, 2002 (54 of 2002); (d) the recovery of any property by an owner or lessor where such property is occupied by or in the possession of the corporate debtor. (2) The supply of essential goods or services to the corporate debtor as may be specified shall not be terminated or suspended or interrupted during moratorium period. (3) The provisions of sub-section (1) shall not apply to- (a) such transaction as may be notified by the Central Government in consultation with any financial regulator; (b) a surety in a contract of guarantee to a corporate debtor. (4) The order of moratorium shall have effect from the date of such order till the completion of the corporate insolvency resolution process: Provided that where at any time during the corporate insolvency resolution process period, if the Adjudicating Authority approves the resolution plan under sub-section (1) of section 31 or passes an order for liquidation of corporate debtor under section 33, the moratorium shall cease to have effect from the date of such approval or liquidation order, as the case may be." (emphasis supplied) Section 18, on which great reliance is placed, is als ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rium is also important and is set out as follows: "31. Approval of resolution plan. (1) If the Adjudicating Authority is satisfied that the resolution plan as approved by the committee of creditors under sub-section (4) of section 30 meets the requirements as referred to in sub-section (2) of section 30, it shall by order approve the resolution plan which shall be binding on the corporate debtor and its employees, members, creditors, including the Central Government, any State Government or any local authority to whom a debt in respect of the payment of dues arising under any law for the time being in force, such as authorities to whom statutory dues are owed, guarantors and other stakeholders involved in the resolution plan: Provided that the Adjudicating Authority shall, before passing an order for approval of resolution plan under this sub-section, satisfy that the resolution plan has provisions for its effective implementation. (2) Where the Adjudicating Authority is satisfied that the resolution plan does not confirm to the requirements referred to in sub-section (1), it may, by an order, reject the resolution plan. (3) After the order of approval under sub-sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tual dealings between the corporate debtor and any creditor." 6. The Joint Development Agreement, in the present case, makes it clear that a license is granted to the developer (i.e. the Corporate Debtor) to enter upon the land, demolish the existing structures and to construct and erect new structures and allot tenements. This is done in the Joint Development Agreement as follows: "1.1.9 License Agreement shall mean and include an agreement by which a license will be granted in favour of the developer to enter upon the said land, to demolish the existing structures, to construct and erect new structures, to allot tenements in such constructed structures to the tenants and to do all other acts as are necessary for implementation of the project. 1.1.10 Project shall mean the building/s to be constructed by the developer and handed over to the society for housing the tenants and to MHADA in terms of this agreement but shall not mean and include the free sale buildings that the developer is entitled to develop and construct in terms of this agreement and in terms of the plan." "2.1.2 For the performance of the project, it is expressly agreed between the parties that: xxx ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assets or legal right or beneficial interest in such assets of the corporate debtor. For this reason, any reference to Sections 18 and 36, as was made by the NCLT, becomes wholly unnecessary in deciding the scope of Section 14(1)(d), which stands on a separate footing. Under Section 14(1)(d) what is referred to is the "recovery of any property". The 'property' in this case consists of land, ad-measuring 47 acres, together with structures thereon that had to be demolished. 'Recovery' would necessarily go with what was parted by the corporate debtor, and for this one has to go to the next expression contained in the said sub-section. 8. One thing is clear that "owner or lessor" qua "property" is then to be read with the expression "occupied or in the possession of". One manner of reading this clause is to state that whether recovery is sought by an owner or lessor, the property should either be occupied by or be in the possession of the corporate debtor. The difficulty with this interpretation is that a "lessor" would not normally seek recovery of property "occupied by" a tenant - having leased the property, a transfer of property has taken place in favour of a tenant, "possessi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AIR 1954 Tra-Co 257. In fact, the High Court, in the present case, expressed its decision in almost the same language as was contained in the case of George v. State. In the second case of State v. Philipose Philip, this aspect was not clearly discussed. The point, however, was considered in detail by a Full Bench of that High Court in Ulahannan Mathai v. State, AIR 1955 Tra- Co 82. The High Court interpreted the expression "No Bill or amendment shall be introduced or moved" in the proviso as requiring that the Bill should neither be introduced nor moved without the prior sanction of the President, and, since in the case of Act 5 of 1950, the Bill was moved for consideration, without the prior sanction of the President, on 23rd March, 1950, after the Constitution had come into force, there had been non-compliance with the proviso. The court rejected the contention put forward before it that what the proviso really stipulates is that no Bill "shall be introduced" or "amendment moved" in the Legislature of a State without the previous sanction of the President. That argument was advanced on the basis of the maxim "reddendo singula singulis" which, according to Black's Interpretat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... maxim to the words "suit" and "proceeding" as follows: "20. There is an apparent distinction between the expressions "proceeding" and "suit" used in Section 22(1). While it is true that two different words may be used in the same statute to convey the same meaning, that is the exception rather than the rule. The general rule is that when two different words are used by the same statute, prima facie one has to construe these different words as carrying different meanings. In Kanhaiyalal Vishindas Gidwani (1993) 2 SCC 144, this Court found that the words "subscribed" and "signed" had been used in the Representation of the People Act, 1951 interchangeably and, therefore, in that context the Court came to the conclusion that when the legislature used the word "subscribed" it did not intend anything more than "signing". The words "suit" and "proceeding" have not been used interchangeably in SICA. Therefore, the reasons which persuaded this Court to give the same meaning to two different words in a statute cannot be applied here. xxx xxx xxx 26. Apart from the semantic difference between the words "suit" and "proceeding" there is the absence of expansive words "or the like" whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in by such a raising contractor vest in the Central Government. They also give rise to a subsidiary question, namely, whether subsidy receivable from the erstwhile Coal Board established under Section 4 of the Coal Mines (Conservation, Safety and Development) Act, 1952 up to the specified date, from a fund known as Conservation and Safety Fund, by such raising contractor prior to the appointed day, can be realised by the Central Government by virtue of their powers under sub-section (3) of Section 22 of the Nationalisation Act, to the exclusion of all other persons including such contractor and applied under sub-section (4) of Section 22 towards the discharge of the liabilities of the coking coal mine, which could not be discharged by the appointed day." In answering the aforesaid question, this Court distinguished Chief Inspector of Mines vs. Lala Karam Chand Thapar (1962) 1 SCR 9 in the context of raising contracts of coal in paragraphs 18 and 19 of the judgment; and such raising agreements by registered instruments being held not to amount to a lease, were held to be licenses coupled with a grant. This being the case, a raising contractor being in possession on behalf of an o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to occupy the building or abandoned it. If the building is let out for business or commercial purpose, complete cessation of the business/commercial activity may give rise to a presumption that the tenant has ceased to occupy the premises. In either case, legal possession of the building by the tenant will, by itself, be not sufficient for refusing an order of eviction unless the tenant proves that there was a reasonable cause for his having ceased to occupy the building. xxx xxx xxx 25. The Court highlighted the distinction between the terms "possession" and "occupy" in the context of rent control legislation in the following words: (Ram Dass case (2004) 3 SCC 684, SCC pp. 687- 88, para 7) "7. The terms 'possession' and 'occupy' are in common parlance used interchangeably. However, in law, possession over a property may amount to holding it as an owner but to occupy is to keep possession of by being present in it. The rent control legislations are the outcome of paucity of accommodations. Most of the rent control legislations, in force in different States, expect the tenant to occupy the tenancy premises. If he himself ceases to occupy and parts with possession in favour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Kerala High Court in a large number of cases. In Mathai Antony v. Abraham (2004) 3 KLT 169, the Division Bench of the High Court referred to several judgments including the one of this Court in Ram Dass v. Davinder (2004) 3 SCC 684 and observed: "4. ... The word 'occupy' occurring in Section 11(4)(v) has got different meaning in different context. The meaning of the word 'occupy' in the context of Section 11(4)(v) has to be understood in the light of the object and purpose of the Rent Control Act in mind. The rent control legislation is intended to give protection to the tenant, so that there will not be interference with the user of the tenanted premises during the currency of the tenancy. The landlord cannot disturb the possession and enjoyment of the tenanted premises. Legislature has guardedly used the expression 'occupy' in Section 11(4)(v) instead of 'possession'. Occupy in certain context indicates mere physical presence, but in other context actual enjoyment. Occupation includes possession as its primary element, and also includes 'enjoyment'. The word 'occupy' sometimes indicates legal possession in the technical sense; at other times mere physical presence. We hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Full Bench went into various authorities and dictionaries as to what the expression "occupied" would mean, as follows: "20. The other term about which considerable argument has been addressed to the Bench is "occupied by him" and it has even been suggested that the property which is let by the owner to a tenant, though not in the former's actual occupation, is in his constructive occupation just as it may be said that he is possessing it though indirectly through his tenant. Reference was made to the connotation of the term "occupied" as given at pages 83 and 84 of Volume 67 of Corpus Juris Secundum. "The term has many meanings; in legal acceptation the term implies use and possession, and it has been said that it implies actual possession and not constructive possession, but it also has been held that "occupied" does not always require an actual occupancy, but it may sometimes permit a constructive occupancy. It is defined as meaning held in possession. "Occupied" is an appropriate word to use for the purpose of identifying land in actual possession, and when applied to a building, implies a substantial and practical use of the building for the purpose for which it is d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Urban Rent Restriction Act, 1949, as made in Shakuntla Bawa v. Ram Parkash and others, ILR (1963) 1 Punj 827. These interpretations depend on the particular context in which the terms occur in the relevant statute but what has been observed in most of these cases is that the term "occupation" is of a wider import than the term possession and means something more than legal possession, which may be either actual or constructive. More helpful are some cases which arose in the Punjab under section 60(1)(c) or (ccc) of the Code." 15. The conspectus of the aforesaid judgments would show that the expression "occupied by" would mean or be synonymous with being in actual physical possession of or being actually used by, in contra-distinction to the expression "possession", which would connote possession being either constructive or actual and which, in turn, would include legally being in possession, though factually not being in physical possession. Since it is clear that the Joint Development Agreement read with the Deed of Modification has granted a license to the developer (Corporate Debtor) to enter upon the property, with a view to do all the things that are mentioned in it, there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ove the State Government to acquire old and dilapidated buildings and which are, in the opinion of the Board, beyond repairs; and to reconstruct or to get reconstructed new buildings thereon for the purpose of housing as many occupiers of those properties as possible, and for providing alternative accommodation to other affected occupiers; 79. Power of Board to undertake building repairs, building reconstruction and occupiers housing and rehabilitation schemes. (1) The Authority may, on such terms and conditions as it may think fit to impose, entrust to the Board the framing and execution of schemes for building repairs or for reconstruction of buildings or for housing and rehabilitation of, dishoused occupiers, whether provided by this Act or not, and the Board shall thereupon undertake the framing and execution of such schemes as if it had been provided for by this Act. (2) The Board may, on such terms and conditions as may be agreed upon and with the previous approval of the Authority- (a) hand over the execution under its own supervision of any building repairs scheme, building reconstruction scheme, or dishoused occupier's housing scheme to a Municipal Corporation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eals that the contract/agreement contemplates that the lease deed was to be executed after the completion of the project. The contract reveals that (a) the project period was for 60 months starting from the date excluding the monsoon period; (b) by Clauses 5 and 17, SevenHills could mortgage the property for securing advances from financial institutions for the construction of the project and thereafter towards its working. Such mortgage/charge or interest was subject to approval by MCGM. In the event the contract was to be terminated, it was agreed that MCGM would not in any manner be liable towards the mortgaged amount and all its rights and ownership would continue to vest in it free from encumbrances (Clause 17). 33. The show cause notice in this case preceded admission of the insolvency resolution process. In view of the clear conditions stipulated in the contract, MCGM reserved all its rights and its properties could not have therefore, in any manner, been affected by the resolution plan. Equally in the opinion of this Court, the adjudicating authority could not have approved the plan which implicates the assets of MCGM especially when SevenHills had not fulfilled its obli ..... X X X X Extracts X X X X X X X X Extracts X X X X
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