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TMI Blog2024 (10) TMI 682X X X X Extracts X X X X X X X X Extracts X X X X ..... ssional ('RP' in short) in the conduct of the Corporate Insolvency Resolution Process ('CIRP' in short) of the Corporate Debtor-Kindle Developers Private Limited. Aggrieved by the observations contained in the impugned order relating to conduct of CIRP by the Appellant/RP, the present appeal has been preferred. 2.Making his submissions, the Learned Counsel for the Appellant submitted that the Corporate Debtor was admitted into CIRP on 09.03.2018. The RP had submitted the resolution plan which had been approved by the Committee of Creditors ('COC' in short) with a voting percentage of 92.39% before the Adjudicating Authority for approval at which stage an application was filed by the Respondent-Noida authority vide I.A. No. 1592/2019, seeking exclusion of plot number SC-01/D1, Sector 79, Noida ('subject plot' in short) from the resolution plan. Exclusion of the subject plot was sought on the ground that the lease of the subject plot with the erstwhile management of the Corporate Debtor was cancelled by them on 13.08.2015 which date clearly preceded the initiation of the CIRP of the Corporate Debtor and hence could not be made part of the resolution plan. 3.Submission was pressed b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... paration of the Information Memorandum projecting the cancelled lease of the subject land as an asset of the Corporate Debtor and for inviting Expression of Interest ('EOI' in short) to obtain resolution plans from prospective resolution applicants. Submitting that the RP acted irresponsibly in getting approval of the resolution plan from the COC as if the said plot of land existed with the Corporate Debtor, it was contended that the observations of the Adjudicating Authority that the RP was attempting to justify the wrong and fraudulent action of the suspended management of the Corporate Debtor that the lease over the land was still subsisting was justified. 6.We have duly considered the arguments advanced by the Learned Counsel for the parties and perused the records carefully. 7.At the outset we may take notice of the reliefs prayed for by the Appellant which are as follows: "a) Allow the present Appeal; b)Set aside the observations my by the Ld. Adjudicating Authority as against the Appellant in Paras 28 & 30 in Impugned Order dated 11.01.2024 passed by the Hon'ble National Company Law Tribunal, New Delhi Bench-II in I.A. No. 1592 of 2019; c)Pass any other Order which t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No forfeiture letter was also issued by the Noida authority following cancellation of the lease. Respondent had not taken back the possession of the subject land from the Corporate Debtor. Instead, it allowed the lease premium and lease rental to accumulate in its books. Moreover, Noida authority had never objected to the UP RERA registration of 15.08.2017 and this had resulted in creation of third-party rights over the subject plot. It was only on 10.11.2020 that the Noida authority rejected the request for restoration of the plot of land by which time moratorium under Section 14 of IBC had come into place. 10.In defence of its diligent conduct of the CIRP proceedings, the RP has stated that several meetings were facilitated between the suspended management of the Corporate Debtor and the Noida authority so as to resolve the dispute as regards the subsistence of the lease. Since these efforts remained inconclusive, the Information Memorandum prepared by the Appellant also expressly stated that the lease was cancelled by the Noida authority due to non-payment of dues by way of a letter dated 13.08.2015. It has also been submitted that the resolution plan that was approved by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lease deed had been cancelled much before the commencement of the CIRP, the Corporate Debtor had lost the right to possess the subject plot before the initiation of CIRP. Since the subject plot ceased to be an asset of the Corporate Debtor with effect from 13.08.2015, the provision of moratorium in terms of Section 14 of the IBC will not get attracted in the present case. 13.There is nothing on record to show that post cancellation of the lease deed, the Noida authority was paid any lease rent or there is any written permission or assent of the Noida authority for restoration or continuation of the said lease. Simply by having filed an application for restoration of the said plot of land, the deemed subsistence or continuation of the lease deed cannot be presumed. The lease having been cancelled on 31.08.2015 for want of deposit of necessary lease rent/charges in terms of the allotment, the lease land could not have been made a part of the resolution plan of the Corporate Debtor. Even the UP RERA registration had been obtained by falsely claiming the legal title over the lease land. It is also the case of the Noida authority that it could not object to the UP RERA registration sin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plot as the asset of the Corporate Debtor and getting approval of the resolution plan from the COC as if the said plot existed with the corporate debtor. Such a resolution plan which is premised on the basis that the land belonged to the Corporate Debtor could not have been considered by the COC. In the adjudication of I.A. No. 1592 of 2019, the Adjudicating Authority on 20.02.2020 had noted that the Noida authority had apprised the Bench that the lease of the subject land which constituted the substratum of the housing project of the Corporate Debtor was cancelled and not subsisting. The Adjudicating Authority had therefore correctly raised the question of how it could consider a resolution plan when the lease of the allotted land had already been cancelled by the Noida authority in 2015. The Adjudicating Authority in its order dated 20.02.2020 had directed the RP to file a complaint with the EOW cell of Delhi police and this again shows that RP had not taken this action on his own volition but was goaded into action by the RP. 16.We also notice that this order of the Adjudicating Authority was challenged by the RP by filing CA (AT) (Ins) No. 605 of 2020 before this Tribunal on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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