National Company Law Appellate Tribunal
Nacre Gardens Hyderabad Limited vs Telengana State Industrial ... on 23 July, 2025
NATIONAL COMPANY LAW APPELLATE TRIBUNAL
AT CHENNAI
(APPELLATE JURISDICTION)
Company Appeal (AT) (CH) (Ins) No.301/2023
(IA No. 921/2023)
In the matter of:
Nacre Gardens Hyderabad Limited
(Formerly known as Unitech Hyderabad Township Limited)
Through its Authorized Representative
Smritik Paul
Having its registered office at:
Basement 6, Community Centre,
Saket, New Delhi-110017 ...Appellant
Versus
Telangana State Industrial Infrastructure Corporation
5-9-58/B, 6th Floor, Parishrama Bhavan,
Basheerbagh, Fateh Maidan,
Hyderabad, 500 004 ...Respondent
Present:
For Appellant :Mr. Siddharth Batra & Ms. Shivani Chawla, Advocates
JUDGMENT
(Hybrid Mode) [Per: Justice Sharad Kumar Sharma (Member Judicial):
1) A proceeding under Section 9 of I & B Code, to be read with Rule 6 of I & B (Application to Adjudicating Authority) Rules 2016, stood instituted before the Learned NCLT, Hyderabad Bench, by the Appellant, in the capacity of being an Operational Creditor for the purposes of initiation of the CIRP proceedings, as against the Respondent i.e., Telangana State Industrial Infrastructure Corporation Limited, (TSIIC) the alleged Corporate Debtor. The proceedings of the Company Petition as detailed aforesaid, stood rejected by the Learned Tribunal by the Impugned Order dated 22.05.2023, along with imposition of cost of Rs. 5,00,000/-
payable by the Appellant Consequentially, the present Company Appeal. Com App (INS) No. 301/2023 Page 1 of 9
2) When this Company Appeal was taken up, before this Appellate tribunal, as fresh, this Tribunal had issued notices to the Respondent by an order of 22.09.2023. The steps for serving the Respondent was taken by the Appellant by the modes as prescribed by the order of 22.09.2023, and the Appellant has taken steps to serve the Respondent by supplying the requisites, and in furtherance thereto, the Appellant has also filed an Affidavit of Service on 09.11.2023, wherein it was observed that the private notices were issued to the Respondent by Registered Post on the address as per the master data that was available on the website of the Ministry of the Corporate Affairs, and that the Respondent had received the notices on 25.10.2023. Since, the notice has already been served upon the Respondent, as back as on 25.10.2023, and despite of service of notice, they have not put an appearance, this Appellate Tribunal has got no other option, except to proceed to hear the Appeal finally, in their absence.
3) The brief facts, which could be borne out from the records are that, the Appellant herein, Nacre Gardens Hyderabad Limited was initially christened as, Unitech Hyderabad Township Limited. Which is a SPV of Unitech Limited, that Unitech Limited were awarded with a Letter of Award (LOA) on 28.11.2007, by the Respondent (TSIIC) and consequent to this LOA, a joint development agreement (JDA) was, also said to have been executed on 19.08.2008 between the Appellant (United Hyderabad) and Respondent (TSIIC), after Unitech Limited made, the payment to the tune of Rs. 145 Crores and deposited earnest money of Rs. 20 Crore in favour of the Respondent and that the Joint Development Com App (INS) No. 301/2023 Page 2 of 9 Agreement had provided for a compensatory payment to be made by the Respondent to this Appellant, in case the Respondent fails to execute the sale deeds with respect to the allotted lands in favour of the Appellant as allotment of the subject land by the Respondent and the deposit of amount was subject to the outcome of the litigations pending before the Hon'ble High Court of Andhra Pradesh.
4) The proceedings, in respect of the subject land as above which was going on before the Hon'ble High Court of Andhra Pradesh in AS No. 274/2007, concluded with the Hon'ble High Court of Andhra Pradesh holding vide its judgment dated 19.12.2011 that the Respondent do not have title over the land it allotted to the Unitech Limited (Appellant). The matter travelled to Hon'ble Apex Court who confirmed the Judgment of Hon'ble High Court vide its judgment dated 09.10.2015. This final declaration of law meant that the Respondent was in default of its obligations, under the Joint Development Agreement dated 19.08.2008, to execute sale deeds and cast upon the Respondent, the liability to refund Rs. 165 Crores to the Appellant along with the interest payable on it as per the JDA. Accordingly, the Appellant requested the Respondent to make the necessary payment. Failing to get any positive response, Appellant approached the Hon'ble Apex Court vide WP(Civil) No. 302 of 2017, praying for a direction to TSIIC to return the said amount with interest. Hon'ble Apex Court on 01.05.2017, directed the Appellant to approach Hon'ble High Court under Article 226. Appellants filed Writ Petition being WP No. 29722/2017, before the Hon'ble High Court with the Com App (INS) No. 301/2023 Page 3 of 9 same prayer as above. Hon'ble High Court vide its judgment dated 23.10.2018, ordered TSIIC to pay Rs. 660.55 Crores (sum of principal and interest) within 4 weeks. Aggrieved by this, TSIIC filed an Appeal in WA1594/2018, before the Division Bench. Hon'ble Division Bench held that the decision of Hon'ble Single Judge is based on undisputed and admitted facts of debt owed by TSIIC to the Appellant and that TSIIC has to pay Rs. 165 Crores with interest as per agreed rates but interest is payable from 09.10.2015 (the date of decision of Hon'ble Apex court in the case of Government of Andhra Pradesh Vs. Pratap Karan) and not from 2007. Aggrieved by this, Appellants filed SLP(Civil) No. 9019/2019, before Hon'ble Apex Court, seeking to reversal of the decision on interest to be paid by TSIIC. TSIIC also filed an Appeal in SLP (Civil) No. 10135/2019, challenging the order in WA 1594/2018. They were heard in Civil Appeals Nos. 317/2021 and 318/2021, by the Hon'ble Apex Court and finally Hon'ble Apex Court vide its judgment dated 17.02.2021, ordered that Appellant be paid Rs. 165 Crores along with interest compounded at SBI-PLR from the respective dates of deposit with TSIIC, the interest payable will not be compounded, the amount already deposited with the Registry of Hon'ble Apex Court will be paid to the Appellants with interest accrued thereon, the balance be paid by TSIIC within 2 months of receipt of copy of order, the development agreement, though unregistered will not hinder the payment of dues to Appellant, and TSIIC shall get the agreement registered by paying requisite stamp duty and deduct the same from the refund due and payable to the Appellants Unitech.
Com App (INS) No. 301/2023 Page 4 of 9
5) In obedience TSIIC computed the total dues to be Rs. 461,75,88,858/- consisting of principal amount of Rs. 165 Crores and interest upto 24.11.2021 as Rs. 296,78,88,858/- and deducting Rs. 5,39,00,000/- as stamp duty payable, paid the balance Rs. 456,39,88,858/- on various dates from 08.07.2020 to 24.11.2021 (page 251-253 of Appeal Memo) and submitted the details to Learned NCLT, by a memo dated 23.03.2023, stating that TSIIC was discharged from the liability of payment of dues to the Appellants M/s. Unitech Ltd.
6) While the matter was pending at Hon'ble Apex Court, the Appellants issued demand notice on 04.04.2019 in Form-3 on TSIIC. Subsequently, they filed a Company Petition in CP(IB)289/2019, before the Learned NCLT, Hyderabad seeking initiation of CIRP under Section 9 of IBC. The matter was kept pending because of pendency of SLP filed by both parties. Subsequently, the matter got listed on 21.03.2023 and on 23.03.2023 TSIIC filed a memo before Learned NCLT that they have completed the payment as ordered by Hon'ble Apex Court as back as on 24.11.2021. After hearing both sides, Learned NCLT passed the impugned order dismissing the Company Petition and imposing a cost of Rs. 5,00,000/- on Appellants. The relevant parts of the impugned order are extracted below: -
"8. The copy of the additional affidavit dated 05.12.2022, which was filed by the General Manager (AM) legal of the TSIIC, before the Civil Court at Gurgoan, further discloses that a sum of Rs. 456,39,88,858.01/- was payable to M/s Unitech Com App (INS) No. 301/2023 Page 5 of 9 Limited (Corporate Debtor) as per the order of the Hon'ble Supreme Court of India, in Civil Appeal No. 317 of 2021 dated 17.02.2021, and the same has been paid to the Unitech Limited, as per the details mentioned in the said affidavit.
9. Therefore, it is as clear as crystal, that over and above the amount claimed by the Operational Creditor as due and payable by the corporate debtor, in the above Company Petition has been deposited by the corporate debtor by 21.02.2021 itself. Strangely despite, being fully conscious of the deposit of the sum of Rs. 456,39,88,858.01/-, the Petitioner/Operational Creditor, did not choose withdraw the above Company Petition and on the other hand pursued the matter till 21.04.2023 and thus, unjustly prolonged the matter and consumed the precious time of the Tribunal, and the public as well.
10. Therefore, in the light of our discussion as above we have no hesitation to hold that the plea of existence of an Operational Debt of a sum over rupees one crore due and payable by the respondent to the petitioner and that the respondent had defaulted in payment of the same, no survives. Consequently the Corporate Debtor cannot be admitted into CIRP.
11. Since the Operational Creditor had failed in disclosing the compliance of the order of Hon'ble Supreme Court, supra, and pursued the matter of Com App (INS) No. 301/2023 Page 6 of 9 receipt of the sum of Rs. 456,39,88,858.01/- for nearly two years, we feel it is a fit case to impose costs on the Petitioner, while dismissing this application.
12. Hence, this Company Petition is dismissed with costs of Rs.5,00,000/-(Rupees Five Lakhs only) payable by the petitioner to the BHARAT KOSH, within 15 days from the date of uploading of this order and proof of deposit shall be filed before the Registry in the form of a memo."
7) It is the case of the Appellants that though TSIIC had paid the entire amount due pursuant to the Judgment of Hon'ble Apex Court, it has failed to register the JDA, even though it retained the assessed stamp duty amount for the same, (that imposition of cost of Rs. 5,00,000/-) is in non-compliance of direction of Hon'ble Supreme Court in the matters of Bhupender Singh Vs. M/s. Unitech Ltd. Where moratorium was imposed on 20.01.2020, against institution of proceedings against Unitech, that Hyderabad office is non-functional since 2015 and instruction to counsels could not be given in time, that since erstwhile BOD was superseded and new BOD was put in place, proper instructions to withdraw the petition could not be given by the new management in time because Unitech is still under resolution, that there is no willful default or misconduct, and that they were waiting for the registration process to be completed, that adjournments were sought to verify the registration process so as to give correct picture to Learned NCLT, that the cost imposed is excessive in view of the financial position of Unitech and therefore the Com App (INS) No. 301/2023 Page 7 of 9 order imposing a cost of Rs. 5,00,000/-.
8) After having heard the Learned counsel for the Appellant and going through the records, and particularly in the context of the finding that has been recorded, which are undebated, we are of the view that the demand as raised in the notice under Section 8 of I & B Code, it already stood satisfied by the remittance of the entire amount and that rather, much more than the amount paid by TSIIC pursuant to the directions of Hon'ble Apex Court was much more than what was demanded by the Appellant, receipt of which has not been denied by the Appellant. Despite this, the Appellant never brought to the notice of Learned NCLT the factum of remittance of amount by TSIIC in full, till it was disclosed by TSIIC by filing a memo on 23.03.2023. Even thereafter the Appellant, after undertaking to withdraw the Company Petition did not do so despite taking 4 adjournments. The conduct of the Appellant is truly reprehensible: in fact, Learned NCLT has expressed its anguish that the factum of settlement was not brought to its notice by the Appellant and but for the memo filed by the Respondent (TSIIC), it would gone on to frame the issues for adjudication and that the Appellant chose not to withdraw and instead, chose to pursue the matter till 24.04.2023 wasting precious time of the Tribunal and public as well. Finally, the Learned Tribunal held that no due is to be paid to the Appellant and accordingly missed the Company Petition. Further, holding that since the Appellant unnecessarily prolonged the matter for more than 2 years, it is a fit case for imposing costs and accordingly imposed a cost of Rs. 5,00,000/-.
Com App (INS) No. 301/2023 Page 8 of 9
9) We do not file any anomaly in the order findings and the order of Learned NCLT. However, keeping in view the pleadings of the Appellant that the management had changed, head office was disbanded, the parent company M/s. Unitech was undergoing insolvency and no proper instructions could be obtained for withdrawal of the Petition, and that inaction on its part was neither deliberate nor wanton all of which appear plausible and taking a pragmatic view, the cost of Rs. 5,00,000/-, is being directed to be reduced to Rs. 1,00,000/- which is to be deposited by the Appellant in the Bharath Kosh, within 30 days from the date of uploading of the order. And the proof of the deposit would be placed before the Registry of this Appellate Tribunal. Subject to the aforesaid, the Company Appeal will stand closed. All Interlocutory Applications would also that have been filed and pending stand closed.
[Justice Sharad Kumar Sharma] Member (Judicial) [Jatindranath Swain] Member (Technical) 23.07.2025 RO/MS/RS Com App (INS) No. 301/2023 Page 9 of 9