TMI Blog2019 (12) TMI 1580X X X X Extracts X X X X X X X X Extracts X X X X ..... pplicant to facilitate the CIRP process and allow the Resolution Professional to take possession of the assets of Corporate Applicant, pending adjudication of pending suit filed by Corporate Applicant seeking possession of the shed from the applicant. Section 60(5) and (b)(c) of the Code empowers NCLT to entertain the dispute raised in the suit, section 63 of the Code further bars the jurisdiction of the civil court in matters pertaining to the NCLAT, section 231 of the Code also bar the jurisdiction of the civil court from granting any injunction in respect of any action taken or in pursuance of any order passed by the Adjudicating authority under this Code - Upon conjoint reading of section 60(5), section 63, section 231 and section 238, the jurisdiction of Civil Court is excluded related to the matters related to I B code. Therefore, it can be held that NCLT can order possession of the property of Corporate Applicant to facilitate the CIRP process and allow the Resolution Professional to take possession of the assets of Corporate Applicant. The principles of comity would be affected if conflicting order were passed by the Civil Court and the NCLT the same would be detrim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter called Corporate Applicant ) filed an under Section 10 of Insolvency and Bankruptcy Code 2016 ( the Code ) read with Rule 7 of Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules 2016, for initiation of Corporate Insolvency Resolution process. 2. The above M.A. was heard by Division Bench consisting of Hon'ble Bhaskara Pantula Mohan, Member(J) and Hon'ble V. Nallasenapathy, Member (T) and an order directing the Resolution Professional to take possession of the Shed from the applicant was passed and dissenting order dismissing the application was passed on 20.08.2019. 3. The said matter was referred to me as a third member as there was a difference of opinion among the members vide orders dated 04.11.2019. the matter was initially posted for hearing on 05.11.2019 and posted to final hearing on 14.11.2019. 4. This court had vide its order dated 11.12.2018 admitted the Petition filed by the Corporate Applicant under Section 10 of the Code declaration moratorium. As a consequential direction this bench also appointed Mr. Suresh Saluja as the Interim Resolution Professional (hereinafter called IRP ). 5. According to the Applicant, on 21.12.2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... titled to ask the Applicant to vacate the said Shed within one month of such notice. As per the Resolution Professional certain disputes arose between the Petitioner and the Applicant. Since the Applicant had committed breach of certain conditions of the Agreement and called upon the Applicant to vacate the Shed invoking Clause of the Agreement vide his Notice dated 22.08.2008. The Corporate applicant filed Special Suit No. 21/2009/A on the file of Hon'ble Civil Court at Bicholim, Goa seeking possession of the said shed from the Applicant. 11. The Resolution Professional further pointed out in his reply that since he has been appointed as the Interim Resolution Professional by this court, it is his duty to take control and custody of any asset over which the Corporate Applicant has an ownership right including assets which may or may not be in the possession of the Corporate Applicant. The Applicant is claiming lien on the Shed under the guise of a pending suit before Civil Court and there is no interim order therein. Therefore, as per the Resolution Professional the same cannot prejudice the right of Resolution Professional under the provisions of the code and has further p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... could no longer survive? Whether the Trial Court committed an error in rejecting the application filed by the Petitioner for dismissal of the suit. The contention raised on behalf of the Petitioner rests on the assertion that IBC has overriding effect over other laws and that the effect of CIRP having been triggered in the context of the Petitioner in the present case resulted in rendering all proceedings like suit filed by respondent no.1 as not maintainable and liable to be dismissed. The Court held that the such a dispute, which not only existed but stood recognised as a sub judice claim for which an inbuilt mechanism was incorporated in the resolution plan, could not be extinguished, merely because CIRP process had been undertaken. The Court at para 37 held as follows: the aforesaid position of law, when applied to the facts of the present case clearly demonstrates that the attempt to the facts of the present case clearly demonstrates that the attempt on the part of the Petitioner to escape liability of paying dues of respondent no.1 as an operational creditor, was correctly shot down by the Trial court by passing the impugned order. Therefore, it is held that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Shed. The counsel for RP further claimed that the judgement of Learned Dissenting member has not considered that there is no dispute of ownership rights and went to hold that he has to take a symbolic possession of the property. 18. I have considered the judgement of the Hon'ble High Court of Delhi in Liberty House Group Pte Ltd. Vs. State Bank of India and Ors. reported in (MANU/DE/0727/2019) which dealt with the issue regarding the jurisdiction of the Civil Court to entertain any suit or proceedings and grant interim injunction restraining encashment of bank guarantees and the objection of the defendants to the subject jurisdiction of the Civil Court was for consideration and whether NCLT has the jurisdiction under the I B Code, 2016. The Court at para 43, 45 and 46 held as follows; 43. It cannot also be lost sight of that in the whole process, considerable time, out of the time bound schedule in terms of the Code for the resolution process, has been wasted and wastage of which time may ultimately result in the possibility of Castex and ARGL Limited being restructured ceasing to exist and being inevitably required to be liquidated, all at the cost of the creditors th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uit filed by Corporate Applicant seeking possession of the shed from the applicant. 22. Section 60(5) of the I B Code, 2016 states that notwithstanding anything contained to the contrary contained in any other law for the time being enforced, the National Company Law Tribunal shall have jurisdiction to entertain and dispose of any application (a) Any application or proceeding by or against the Corporate Applicant or Corporate Person (b) any claim made by or against the Corporate Applicant or Corporate Person by or against any of its subsidiaries situated in India; and (c) Any question of priorities or any question of law or facts, arising out of or in relation to the insolvency resolution or liquidation proceedings of the Corporate Applicant or Corporate Person under this Code. 23. Section 60(5) and (b)(c) of the Code empowers NCLT to entertain the dispute raised in the suit, section 63 of the Code further bars the jurisdiction of the civil court in matters pertaining to the NCLAT, section 231 of the Code also bar the jurisdiction of the civil court from granting any injunction in respect of any action taken or in pursuance of any order passed by the Adjudicatin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quit, vacate and deliver peaceful possession of the suit property, i.e., Shed D3-3 at Honda Industrial Estate in safe and good condition back to the plaintiffs; II) The defendant be ordered to pay to the plaintiff's mesne profits at the rate of ₹ 7,000/- per month from 1st October 2008 till effective delivery of possession of the suit property (Shed No. D3-3) to the plaintiffs; III) The defendant be ordered to pay to the plaintiffs ₹ 1,29,292.95/- with interest at the rate of 15% per annum from filing of the suit till payment, being the value of the material belonging to the plaintiffs, which is in possession of the defendant; IV) The costs of this suit be awarded to the plaintiffs. And the other Special Suit No.23 of 2009 on the file of Court of Civil Senior Judge, senior division at Bicholim, Goa filed by the Applicant for recovery of money for the following prayers: A) That the plaintiffs are entitle to recover from the defendants a sum of ₹ 1,40,000/- being the rent/hire charges of the said milling machine from 01.11.2006 to 28.02.2009 along with the interest at the rate of 10% p.a. and further ₹ 5,000/- per month from 01.03.2009 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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