9911796707
TMI Blog2024 (1) TMI 1323X X X X Extracts X X X X X X X X Extracts X X X X ..... divided and demarcated portion of land admeasuring 3.5 acres out of the total land admeasuring 8 acres being Premises No.CBE/2 in Street No.MAR situated within Mouza Jatragaachi in New Town within Police Station Rajarhat in the District 24 Parganas (North) comprising of Westin Hotel ('Subject Property") from the CIRP of the CD; b) Set aside the invitation of expression of interest dated 28th April, 2022 issued by the RP for alleged deliberate concealment of facts; c) Direct the RP to consider the Claim of SIDCL for INR 909 Crores as a 'qualified claim'. 3. Brief Background: 3.1 Sarga Hotel Private Limited ("CD") owns a five-star hotel under the name of The Westin Kolkata Rajarhat at New Town, Kolkata ("Westin Hotel") which it claims as its sole asset and business. The applicant, SIDCL here, is the promoter/shareholder of the Corporate Debtor viz Sarga Hotel Private Limited (SHPL in short). The Hotel(Westin) is built on a divided and demarcated portion of land admeasuring 3.5 acres (out of the total land admeasuring 8 acres) owned by SIDCL ("Underlying Land"). 3.2 For purpose of its business, the Corporate Debtor entered into a registered lease deed with SIDCL on 31 March, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6.2022, SIDCL has only provided a scanned copy of the alleged Framework Agreement over email to the Company Secretary ("CS") of CD. 5.3 SIDCL has not produced the original of the alleged Framework Agreement. SIDCL has, thus, failed to prove the very existence of the alleged Framework Agreement. The copy of the alleged Framework Agreement will show that it is neither properly stamped nor registered. 5.4 The CS has failed to specifically certify the authenticity of the annexures to the Application including the alleged Framework Agreement. 5.5 That such alleged unregistered Framework Agreement which in effect limits/extinguishes the leasehold rights granted to the CD over the Underlying Land cannot be given affect to or taken as evidence. 5.6 That any document that purports or operates to create/limit/extinguish any right, title or interest, in immovable property is compulsorily registrable under Section 17 of the Registration Act, 1908 ("Registration Act"). Thus, any unregistered agreement which is required to be compulsorily registered can neither affect the Underlying Land nor can it be received as evidence of any transaction allegedly affecting the Underlying Land in view ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of a right to enjoy the property. It is settled issue that lease creates an 'interest' in the demised property which cannot be extinguished by any Sham document. 5.11 It is contended that this Adjudicating Authority, therefore, may not get into the question of what type of asset a leasehold interest is as it is not relevant for the present application where SIDCL has prayed for excluding the Subject Property from CIRP of the Corporate Debtor. 5.12 The Corporate Debtor is not claiming ownership of Subject Property (i.e., Underlying Land) but has only claimed leasehold rights in the Subject Property. These (leasehold rights) are valuable rights' and necessarily form part of the CIRP of the Corporate Debtor. Reliance is once again placed on Victory Iron Works Ltd v. Jitendra Lohia & Anr, 2023 SCC. 5.13 Further reference is made of in NOIDA case where Hon'ble NCLAT in Para-20 holds that the 'Leasehold Rights' is an 'Asset' under 'Intangible Assets' falling within the ambit of Section 18(f) (iv) and that Leasehold Rights accrued to the 'Corporate Debtor' vide the Lease Deed, is a right vested with the 'Corporate Debtor' and is an 'Intangible Assets' and the ownership is only to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red Lease Deed or Deed of Extension and Modification. 6.4 That Execution of an Agreement in counterparts is purely a prerogative of the parties thereto and no adverse inference can be drawn against the parties as done by the RP. Our attention is drawn to Clause 13 of Framework Agreement as extracted below: "13. COUNTERPARTS This agreement may be executed in any number of counterparts, each of which when executed shall constitute a duplicate original, but all the counterparts together constitute the one agreement." 6.5 Drawing attention to the above, it was argued that use of the words "may be executed" clearly demonstrates that understanding between the parties that only one original copy was made. The Applicant derives substantive rights under the same Framework Agreement. 6.6 It is alleged that the RP has lost sight of the fact that, not only the Westin Hotel but also the land underlying belongs to the Applicant. 6.7 It is further submitted that Moratorium will not have application on the properties beyond ownership of the Corporate Debtor. The Applicant has reminded us Latin Maxim, nemo dat quod non habet, that no one can give what they do not have. 6.8 That in ter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ereunder for a period of 50 (fifty) years and execute a Deed of Lease to be registered with the concerned sub-registrar ("Lease Deed") in favour of SHL which shall inter alia provide the lease rent (at a concessional rate), security deposit and other terms and conditions of the lease of the Leased Land. D. The Parties now intend to record their understanding in relation to the Leased Land and the rights of the Parties inter se as provided in this Agreement, whereby, the lease under the Lease Deed shall be subject to the terms and conditions of this Agreement." Xxx xxx xxx xxx The Parties agree that, SHL is allowed to hold the Lease Land and construct, maintain and carry on with the hotel business only as Affiliate and/or Subsidiary of SIDCL The benefit of the Lease Land shall never be intended to be assigned, transferred either by contract or by operation of law in such manner that SIDCL ceases to have control and supervision of SHL or SHL cease to become an Affiliate and/or Subsidiary of SIDCL. Save and except what is provided in this Agreement, the Parties hereby agree that the benefit of the Leased Land shall not be extended to any third party who assumes control and comes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntinue to enjoy the rights and interest under the Lease Deed: (a) payment of an amount aggregating to Rs. 150,00,00,000/- (Rupees One Hundred Fifty Crores only) as lease premium ("Renewal Premium"); and (b) on such renewal, the lease rent payable for the Leased Land shall not be less than Rs. 20,00,000/- (Rupees Twenty Lakhs only) payable per month. 4.2 Notwithstanding the rights of SIDCL contained in Clause 4.1 above, SIDCL shall at its own discretion may re-negotiate the lease terms for the period of the lease as will be provided under the Lease Deed. 9.2 Juxtaposed to the above, the parties within two days, executed a Lease Deed that was registered on 31.03.2007. The recitals in the Registered Lease Deed of dated 31.03.2007 are as under: "C. The Lesee herein has approached the Lessor herein to grant a Lease in respect of ALLTHAT the divided and demarcated portion of the said premises (out of the said entire premises) containing an area of 3.5 Acres (equivalent to 14163.80 Sq. Mtrs.) Xxx xxx xxx xxx "TO HOLD the said DEMISED PREMISES unto the Lessee for the period of 50 years commencing on and with effect from 22nd March, 2007 yielding and paying therefore the ren ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case the Lessor shall be liable to give 45 days prior written notice to the Lessee to cure the above mentioned defect before terminating the lease and shall be entitled to terminate the Lease Deed if such default is not cured within the aforesaid 45 days period"." 9.4 We are mindful of the proposition that if an agreement between parties shows an intention to create an interest in the property in favour of the grantee what results is said to be a lease [AIR 1993 Bom 177]. 10. Lease of immovable property: 10.1 Section 105 of the Transfer of Property Act (TPA in short) defines lease as under: "Lease defined. - A lease of immovable property is a transfer of a right to enjoy such property, made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee, who accepts the transfer on such terms." 10.2 Section 106 of the TPA envisages that duration of certain leases in absence of written contract - would be as under: " In the absence of a contract or local law or usage to the con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ovisions on determination of lease of immovable property. It reads as under: "Determination of lease" as a lease of immoveable property determines - (a) by efflux of the time limited there by; (b) where such time is limited conditionally on the happening of some event-by the happening of such event; (c) where the interest of the lessor in the property terminates on, or his power to dispose of the same extends only to, the happening of any event-by the happening of such event; (d) in case the interests of the lessee and the lessor in the whole of the property become vested at the same time in one person in the same right; (e) by express surrender; that is to say, in case the lessee yields up his interest under the lease to the lessor, by mutual agreement between them; (f) by implied surrender; (g) by forfeiture; that is to say, (1) in case the lessee breaks an express condition which provides that, on breach thereof, the lessor may re- enter or (2) in case the lessee renounces his character as such by setting up a title in a third person or by claiming title in himself; or (3) the lessee is adjudicated an insolvent and the lease provides that the lessor may re-enter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relating to such property, unless where the agreement or declaration has been accompanied or followed by delivery of possession [and the same constitutes a valid transfer under any law for the time being in force: Provided that a mortgage as defined in section 58 of the Transfer of Property Act, 1882 (4 of 1882). shall take effect against any mortgage-deed subsequently executed and registered which relates to the same property." The Framework Agreement (which remains an unregistered instrument) is purportedly projected as conferring a power upon SIDCL to terminate lease of immovable Property created by a registered lease deed upon non-fulfilment of condition. Being not accompanied by delivery of a possession or payment it has no consequence when a registered deed of lease is available in regard to the same property with right to terminate being expressly worded in the modification Deed. 12. We would further note that, Section 49 of the Registration Act, 1908 mandates that no document required by Section 17 to be registered can be received as evidence. It reads as under: "49. Effect of non-registration of documents required to be registered. No document required by section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ration for collateral purposes. It may not be admissible in evidence and as such this Tribunal cannot rely upon the Framework Agreement to ascertain the power of the SIDCL to terminate the lease upon insolvency of the Corporate Debtor. 12.4 This is a case where both the unregistered instrument as well as the registered instrument pertains to the same piece of land and between the same parties. When the parties have decided to enter into an Agreement for lease by way of a registered lease deed, any prior instrument affecting the same property which talks of termination of the lease which is not yet been entered, should be of no consequence. 12.5 We are fortified in our view having noted that Hon'ble Delhi High Court has explained the implication of the term "collateral purpose" appearing in Section 49 of the TP Act, as under: In M/s. Jiwan Industries Pvt. Ltd. Vs. Kamlesh Rani Budhiraja, "an unregistered lease deed can be looked into only for collateral purpose cannot be interpreted to include therein the terms and conditions the parties are related to each other as landlord and tenant. The collateral purpose is to show the nature of possession i.e. the tenant has not illegall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Collector as provided by section 32 or any other provision of this Act. 13.2 Section 36 of the Indian Stamp Act, 1899 is explicit that: "Where an instrument has been admitted in evidence, such admission shall not, except as provided in section 61, be called in question at any stage of the same suit or proceeding on the ground that the instrument has not duly stamped.)" The unregistered Framework Agreement as such cannot be looked into as an evidence for any collateral purpose and not further. 14. We have already noted that the said unregistered Framework Agreement has not been referred to in any of the subsequent registered instruments pertaining to the lease in question. Meaning there by that even if there existed an Agreement between the parties to enter into a lease Agreement subsequently, with a termination Clause which speaks of right to terminate upon lessee's insolvency, the parties may have resiled from their stand later and entered into a Lease Agreement without such termination Clause, and further got it modified to include a termination Clause totally different from that of purported previous informal Agreement. 15. We have perused the original unregistere ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
