NCLT JUDGEMENT ON SECTION 3(11), 7, 13, 14, 31, 32, 33 OF THE INSOLVENCY AND BANKRUPTCY CODE, 2016, RULE 6 OF THE INSOLVENCY AND BANKRUPTCY (APPLICATION TO ADJUDICATING AUTHORITY) RULES, 2016, SECTION 125, 132 OF THE COMPANIES ACT, 1956, SECTION 3, 18, 19, 32, 32(A), 32(3)(B), 33, 34 OF THE MAHARASHTRA STAMP ACT, 1958, SECTION 29, 33, 34, 35, 38, 40 OF THE INDIAN STAMP ACT, 1899, SECTION 62 OF THE INDIAN CONTRACT ACT, 1872 AND SECTION 11, 11(13), 11(6)(A), 29(A) OF THE ARBITRATION AND CONCILIATION ACT, 1996
Vistra Itcl (India) Limited Vs. Satra
Properties (India) Limited, (2020) 08 NCLT CK 0089
NCLT allowed the petition filed by the petitioner,
under Section 7 of the Insolvency and Bankruptcy Code, 2016 (for brevity
'code') read with Rules 4 of the Insolvency and Bankruptcy (Application to
Adjudicating Authority), 2016 (for brevity 'the Rules') with a prayer to
initiate the Corporate Insolvency process against the Corporate Debtor. While
allowing the application NCLT held that it is not the case of the Corporate
Debtor that they have not received funds from the Petitioner by issuing
debentures and the debentures were shown in the balance sheet of the Corporate Debtor
till date. The request of the Corporate Debtor for reduction of interest rate
is a clear proof that the Corporate Debtor had not even paid the interest and
the debentures were not redeemed even after the extension of time granted by
the petitioners for redemption of debentures. All these things clearly proves
the debt and default. The petitioners have complied with the provisions of
Section 7 of the Code. Hence the petition deserves admission and accordingly
the petition is admitted and the Corporate debtor is put under CIRP. NCLT
further held that in Corporate Insolvency Resolution Process against a real
estate, if allottees (Financial Creditors) or Financial Institutions/Banks
(Other Financial Creditors) or Operational Creditors of one project initiated
Corporate Insolvency Resolution Proces against the Corporate Debtor (real
estate company), it is confined to the particular project, it cannot affect any
other project(s) of the same real estate company (Corporate Debtor) in other
places where separate plan(s) are approved by different authorities, land and
its owner may be different and mainly the allottees (financial creditors), financial
institutions (financial creditors, operational creditors are different for such
separate project. Therefore, all the asset of the company (Corporate Debtor)
are not to be maximized. The asset of the company (Corporate Debtor -real
estate) of that particular project is to be maximized for balancing the
creditors such as allottees, financial institutions and operational creditors
of that particular project. Corporate Insolvency Resolution Process should be
project basis, as per approved plan by the Competent Authority. Any other
allottees (financial creditors) or financial institutions/banks (other
financial creditors) or operational creditors of other project cannot file a
claim before the Interim Resolution Professional of other project and such claim
cannot be entertained.
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