TMI Blog2021 (11) TMI 610X X X X Extracts X X X X X X X X Extracts X X X X ..... of I B Code. As a matter of fact, the Ordinance, among other things stated that an application under Section 7 of the Code for initiating CIRP against the Corporate Debtor shall be filed jointly by not less than 100 all such creditors (i.e. Home Buyers). Indeed, the Ordinance among other things mentions that an application under Section 7 of the code for initiating CIRP against the Corporate Debtor shall be filed jointly by not less than 100 all such creditors (i.e. home buyers) or not less than 10% of the total number or such creditors (Home Buyers) whichever is less. In the instant case on hand, the impugned order passed by the Adjudicating Authority (National Company Law Tribunal, Hyderabad Bench, Hyderabad) does not contain any direction being issued to the Respondents and other purported allottees to amend their application as laid down under Section of the code. Without there being a direction issued to the concerned financial creditor/allottees to amend their applications as per Section 7 of the Code, the directions issued by the Adjudicating Authority to its Registry as in the impugned order to club such applications together and place before it for hearing cannot be cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ined in the first and the second proviso. In that sense, it could be said that it was not retrospective. We have found that when invoking the unamended section 7 applications stood moved, they evinced creation of vested rights to continue with the proceeding. The applications were, no doubt, at the stage, prior to the admission under Section 7(5). It is at this stage that through the device of the third proviso, the parliament has applied the principle of first and second proviso of threshold requirements, in respect of pending application, which is made to appear as it would have operation in the future. Now here we must address an argument of the 3rd proviso going to mere procedure. The financial creditor covered by the 3rd proviso were clothed with a statutory right under section 7. This right was available to be exercised by an individual creditor, by himself or jointly with others. The imposition of a threshold requirement being a mandatory and irreducible minimum even, it is to be achieved as and after the date of the amendment, constitutes an intrusion 9into the substantive right of action vested in the individual creditor. The action of the creditor was not a completed tran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Limitation Acte, in regard to the period, during which, the applications were pending before the Adjudicating Authority, which were filed under the unamended section 7, as also thereafter. 5. In short upon going through the ruling of Hon ble Supreme Court, we are of considered opinion that single allotee s application filed prior to amendment cannot be rejected. We further hold that the allotee s in same project against same corporate debtor are allow to pursue their applications jointly. We direct that all such applications shall be heard jointly. 3. According to the Learned Counsel for the Appellant the impugned order dated 18.06.2021 passed by the Adjudicating Authority (National Company Law Tribunal, Hyderabad Bench, Hyderabad) is contrary to the directions issued by the Hon ble Supreme Court in the judgement in Manish Kumar V Union of India Anr (Writ Petition (c) No.26 of 2020). In this connection, the Learned Counsel for the Appellant adverts to the 2nd and 3rd Proviso of Section 7 of the (Amended) I B Code which runs as under and submits that only when the threshold as provided under the 2nd Proviso to Section of the Code is satisfied, the allottees of Real Es ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entioned as under:- 372. We uphold the impugned amendments. However, this is subject to the following directions, which we issue under Article 142 of the Constitution of India: 7. According to the Learned Counsel for the Appellant, neither the Respondent nor other purported allottees of the Appellant had filed any application seeking modification of their affidavit as envisaged under the Amended Section 7 of the Code. But the two Allottees had filed affidavit in in CP (IB) No.682/7/HDB/2019 and CP(IB)No.683/7/HDB/2019, for clubbing all pending applications against the Appellant filed before the Adjudicating Authority and that the said filing of an affidavit is contrary to the Amendment Act. 8. The Learned Counsel for the Appellant pointed out the decision of Hon ble Supreme Court in Manish Kumar case wherein at paragraph 365 it is observed as under; 365. As regards the compelled withdrawal under the third proviso of the pending applications is concerned, we hold as follows: Once the Legislature intended that the pending applications must be made compliant with the threshold requirement, consequences for not doing so had to be provided. Otherwise, it would have cre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d jointly by not less than 100 all such creditors (i.e. home buyers) or not less than 10% of the total number or such creditors (Home Buyers) whichever is less. 13. To be noted, that on 13.03.2020, the Ordinance was approved by the Parliament vide the enactment of Insolvency Bankruptcy Code (Amendment) Act, 2020 14. Apart from that, the constitutional validity of the I B Code (Amendment) Act, 2020 was upheld by the Hon ble Supreme Court in the matter of Manish Kumar Vs Union of India and Another (Writ Petition (Civil) No.26/2020). 15. The Learned Counsel for the Appellant points out that on 04.03.2021 the Adjudicating Authority (National Company Law Tribunal, Special Bench, Court No.II, Hyderabad) had reserved the applications for orders in CP(IB)No.394/7/HDB and CP(IB)No.682/7/HDB/2020, one of the batch matters, on the issue of maintainability about clubbing of all matters to be considered and on 18.06.2021 had passed the impugned order , which is assailed before this Tribunal, in the instant Appeal. 16. It may not be out of place to this Tribunal to make a significant mention that Section 7(1) of the Code mandate that for financial creditors who are Allottees under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing for modification of their petitions as adumbrated as per Section 7 of the I B Code. In fact only two allottees viz. Mr Sunder K Sundaresan (in CP (IB) No.682/7/HDB of 2019) and Mr P.V. Rao had filed their affidavit (in CP (IB) No.683/7/HDB of 2019) for clubbing of all petitions against the Appellant. This Tribunal points out that filing of affidavit is impermissible by virtue of the Amendment Act. 21. Be that as it may, in the light of the detailed foregoing discussions and this Tribunal taking into consideration inter conceptus of the facts of the present case, in an integral manner and keeping in mind the dictum laid down by the Hon ble Supreme Court in the case of Manish Kumar Vs Union of India comes to a resultant conclusion that the impugned order dated 18.06.2021 passed by the Adjudicating Authority (National Company Law Tribunal, Hyderabad Bench, Hyderabad) suffers from legal infirmities in the eyes of law and the same is set aside by this Tribunal to secure the ends of justice. Resultantly the Appeal succeeds. In fine the Appeal is allowed. No costs. The impugned order dated 18.06.2021 passed by the Adjudicating Authority is set aside and the matter is remitted back ..... X X X X Extracts X X X X X X X X Extracts X X X X
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