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TMI Blog2022 (3) TMI 756X X X X Extracts X X X X X X X X Extracts X X X X ..... vency Resolution Process (CIRP in short) against the Corporate Debtor-"M/s. MK Overseas Private Limited". One of the assets of the Corporate Debtor was Plant at Plot M-6, Taloja Industrial Area, Village Pale Khurd, Taluka Panvel, Distt Rajagd, Maharashtra. The plant was mortgaged to Yes Bank for availing Credit Facilities. Yes Bank on 01st August, 2019 had granted a conditional No Objection Certificate (NOC in short) to the Corporate Debtor for sale of the said property for at least Rs. 17.86 Crore. By a Resolution passed by the Board of Directors of the Corporate Debtor dated 15th April, 2019, a decision was taken by the Corporate Debtor to sell the plant located at Taloja Industrial Area, Village Pale Khurd, Taluka Panvel, Distt Rajagd, Maharashtra. There were several transactions made by the Corporate Debtor within the relevant period which came to be examined under the Transaction Audit conducted by Transactional Auditor after initiation of Insolvency Resolution Process. Transactional Auditor submitted a Report dated 02nd July, 2020 where reference of several preferential and undervalued transactions was enumerated. The Resolution Professional filed an Application being I.A. No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er Section 43 and 45 of the Code has been decided by the Impugned Order. It is submitted that Appellant is bona fide purchaser who could not have been deprived possession of the property validly obtained. 4. Learned Counsel for the Resolution Professional refuting the submissions of the Learned Counsel for the Appellant contends that claim of the Appellant is a fraudulent claim. Board Resolution dated 15th April, 2019 of the Corporate Debtor which was passed with the signatures of Mohd. Nasira Begum and Mohd. Kamil for executing the sale of said Taloja Industrial Area was passed by Directors who were no more the directors of the Corporate Debtor. Mohd Nasira Begam ceased to be director of the Corporate Debtor with effect from 12.09.2018 whereas Mohd Kamil ceased to be director of the Corporate Debtor on 12.09.2018 and both of them claimed to have passed the Board Resolution dated 15th April, 2019 which Resolution was itself void and inoperative and all actions taken in pursuance of the said Board Resolution has no legal status and liable to be ignored. It is further submitted that the said Taloja Industrial Area Plot is mortgaged with the Yes Bank and Yes Bank has issued condition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the information available the possession of the plant has been handed over by the Corporate Debtor to the buyer in the month of August 2019 only which is in anticipation of triggering of the CIRP. It is further submitted to point out that the said property record as available with CERSAI show that the above property has been charged with YES Bank. It is clear that the ex-management of the Corporate Debtor has transferred and handed over the possession of such property at Rs. 0.63 crore only against the amount as per YES Bank's condition NOC i.e. Rs. 17.86 Crore, indicting an undervalution thereof Rs. 17.23 Crore. The relevant extract of the ledger, CERSAI Search report, copy of the conditional NOC from YES Bank and copy of the sale Agreement has been annexed under para 16.2 of the report annexed with this application. iii. It is further submitted that sale of the above mentioned property was cancelled as the buyer paid Rs. 62.25 lakh and YES Bank kept such amount under lien till the balance amount of Rs. 10.37 crore is received and due to initiation of the CIRP the buyer failed to pay the consideration in full. Hence, the amount was forfeited and necessary entry was passed in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsideration of the Agreement for Assignment cum Transfer of Lease-cum-Sale dated 05.08.2019 mentioned 11 Crore but total amount paid by the Appellant in the Account of the Corporate Debtor was 0.63 Crore and the entire possession of the property was handed over by Directors of the Corporate Debtor on receipt of only 0.63 crores, which speak for itself. The Appellant never paid the balance amount of consideration amount apart from payment of Rs. 0.63 crore. Clause 4 of the deed contemplated handing over possession after payment in Loan Account in of Seller which clause 4 is as follows: "4. On receipt of demand cum NOC from Yes Bank the repayment by Purchaser/Assignee directly to Loan Account in of Seller/Assignor in Yes Bank thereafter peaceful possession of the said plot on as is where basis is shall also be handed over the Purchaser/Assignee on or before execution this present." 10. There is one more reason due to which the Transaction dated 05.08.2019 has to be held to be undervalued. The Agreement for Assignment cum Transfer of Lease-cum-Sale mentions the consideration of Rs. 11 Crores. In Paragraph 3, 3(A) and 3(B) payments schedule are mentioned. The Purchaser/Assignee alre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction. Where an Application under Section 45(1) is allowed the effect of the Order has to be treated to be in accordance with Section 45(1). The use of expression used in the Impugned Order is that "as a consequent to the cancellation of the sale of the Mumbai Plant, it is hereby directed that the possession of the Mumbai Plant be handed over to the Resolution Professional". The Adjudicating Authority itself has not directed for cancellation of the sale rather cancellation of sale deed was inferred on account of non-payment of balance consideration and entry made by the Bank in its books of accounts. Direction in the Impugned Order is only to hand over the possession of the plant to the Resolution Professional which is consequential action on account of reversal of the transaction. The Order passed by the Adjudicating Authority thus cannot be said to be beyond Section 45(1). However, when transaction is treated to be void it loses all its legal effect and submissions of Learned Counsel for the Appellant that since application for declaring the transaction void being Application No. 1304 of 2020 pending no direction could have been issued by the Adjudicating Authority as has been is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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