Shrishti Infrastructure Development ... vs Shriram Multicom Private Limited & Ors on 4 April, 2024

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National Company Law Appellate Tribunal

Shrishti Infrastructure Development ... vs Shriram Multicom Private Limited & Ors on 4 April, 2024

This Appeal has been filed challenging the order dated 23.02.2024 passed by the Adjudicating Authority (National Company Law Tribunal) Kolkata Bench, Kolkata in I.A. (IBC) No. 435/KB/2024. Application I.A. (IBC) No. 435/KB/2024 was filed by the Respondent No.1- Successful Resolution Applicant (SRA) praying for various directions in which application order was passed on 23.02.2024 granting prayers (a) to (d) and 2 the matter was further directed to be listed on 04.03.2024. Aggrieved by the said order, Appellant has come up in this Appeal.

2. Brief facts of the case to be noticed for deciding the Appeal are:-

2.1. On an application filed by the Financial Creditor- Yes Bank Limited, Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor- 'Sarga Hotel Private Limited' commenced on 11.02.2022. Resolution Professional issued an invitation for Expression of Interest on 28.04.2022.

Respondent herein was one of the Resolution Applicant who has filed the Resolution Plan. Committee of Creditors (CoC) on 30.05.2023 approved the Resolution Plan submitted by the Respondent No.1 and application being IA No.1054 of 2023 was filed by the Resolution Professional for approving the Resolution Plan. IA No.690 of 2022 was filed by the Appellant praying for exclusion of the lease land from the assets of the Corporate Debtor. The Adjudicating Authority on 04.01.2024 rejected IA No. 690 of 2022 filed by the Appellant against which Company Appeal (AT) (Insolvency) No. 71 of 2024 has been filed by the Appellant. On 04.01.2024, the Adjudicating Authority also allowed IA No.1054 of 2023 approving the Resolution Plan. Against the order dated 04.01.2024 passed in IA No. 1054 of 2023, Company Appeal (AT) (Insolvency) Nos. 70 of 2024 and 71 of 2024 have been filed by the Appellant in which order was passed by this Tribunal that implementation of the Resolution Plan shall abide by the result of the Appeal. SRA proceeded to implement the Resolution Plan and there being certain obstructions in the implementation, IA No.435 of 2024 was filed Company Appeal (AT) (Insolvency) No. 491 of 2024 3 before the Adjudicating Authority on which an interim order passed on 23.02.2024, aggrieved by which order this Appeal has been filed.

3. In IA No.435 of 2024, following reliefs have been prayed for by the SRA:-

"A. Direct the Respondent No. 1 and 2 and their men, servants, and agents to seize and desist from interfering & creating hindrances in ingress and egress to the hotel premises as well access to such essential facilities/ utilities/ services required for running of the operations of the hotel as mentioned in paragraph 11 and 12;

B. Direct the Respondent No. 5, 6 and 7 to protect and prevent any obstruction, annoyance or injury to any person lawfully employed at the Corporate Debtor and ensure that there is no danger to human life, health or safety or disturbance of the public/guest at the Hotel Westin;

C. Direct the Respondent No. 5,6 and 7 to assist the Applicant in implementation of the approved resolution plan in the Corporate Insolvency Resolution Process of Sarga Hotel Private Limited;

D. Direct the Respondent No. 5,6 and 7 to maintain law and order situation at the Hotel Westin;

E. Punish the Respondent Nos. 1 and 2 and their men, servants, and agents for wilfully contravening the resolution plan approved by this Hon'ble Tribunal on 4th January 2024 in I.A. (IBC) No. 1054/KB/2023 in accordance with Section 74 (3) of the I&B Code, 2016 with imprisonment of 5 years along with fine to the tune of Rs. 1,00,00,000 (Indian Rupees One Crore) each;

F. Ad interim orders in terms of prayers made hereinabove G. Pass further Order(s) and/or Directions as this Hon'ble Tribunal may deem fit and proper."

Company Appeal (AT) (Insolvency) No. 491 of 2024 4

4. Learned Counsel for the Appellant challenging the order dated 23.02.2024 submits that the Adjudicating Authority passed order hurriedly without giving appropriate opportunity to the Appellant to respond to the application. It is submitted that the order passed by the Adjudicating Authority on 04.01.2024 has not become final and is under challenge in Company Appeal (AT) (Insolvency) Nos.70 and 71 of 2024 where this Tribunal has directed that implementation of the Resolution Plan shall abide by the result of the Appeal. The SRA has filed IA No.435 of 2024 seeking various directions. It is submitted that the Adjudicating Authority failed to take note of the manner in which the plan was being implemented to the prejudice of the Appellant being the land owner. It is submitted that after passing of the final order dated 04.01.2024 by the Adjudicating Authority immediately the same was challenged before this Tribunal and said order has not become final. It is, however, submitted that the Appellant has always extended co-operation in running the Corporate Debtor as a going concern. It is submitted that the common facility and services which are located outside the land leased to the Corporate Debtor on which land the Corporate Debtor has no right, hence, the Adjudicating Authority ought to have awaited the decision of this Tribunal in Company Appeal (AT) (Insolvency) Nos.70 and 71 of 2024 challenging the approval of the Resolution Plan. In the name of the implementation of the plan, the Corporate Debtor has sent several persons who created ruckus on the area of common utility for which complaint has already been filed on 22.02.2024 before Eco Park Police Station.

Company Appeal (AT) (Insolvency) No. 491 of 2024 5

5. Learned Counsel appearing for the Resolution Professional refuting the submissions submit that the Resolution Plan has already been approved on 04.01.2024 by the Adjudicating Authority and there is no interim order passed by this Tribunal. It is further submitted that the order dated 23.02.2024 was passed by the Adjudicating Authority as an interim measure to ensure that the Corporate Debtor runs as a going concern and the plan be implemented. It is submitted that as per the approved Resolution Plan, Corporate Debtor is entitled to use the common facility and services in which no obstruction can be created by the Appellant. It is submitted that the Adjudicating Authority has granted opportunity to the Appellant to complete the pleading and order is only an interim measure and matter has further fixed for 04.03.2024.

6. Learned Counsel for the SRA submits that against the order dated 04.01.2024 approving the Resolution Plan, only interim order granted by this Tribunal was that implementation of the Resolution Plan shall abide by the result of the Appeal. Thus, implementation of the Resolution Plan was not stopped by this Tribunal. It is submitted that the security guards deployed by the Appellant prevented the ingress and egress of staff, employees and guests of the Hotel whereas shared services are sine qua non to the functioning of 5-star Hotel. It is submitted that on 22.02.2024 supply of electricity was stopped for 45 minutes and servants, agents and security guards of the Appellant are consistently trying to disrupt and to take possession of the server room. It is submitted that the SRA has made Company Appeal (AT) (Insolvency) No. 491 of 2024 6 payment of Rs.145 Crores on 14.02.2024 which is first tranche payment. Respondent No.1 is entitled to implement the Resolution Plan. It is submitted that it is the Corporate Debtor who is operating the shared service and making payment for the same. Corporate Debtor is a going concern. It is submitted that the order dated 15.02.2024 is only an interim order.

7. We have considered the submissions of the Counsel for the parties and perused the record.

8. Company Appeal (AT) (Insolvency) No. 70 of 2024- "Shristi Infrastructure Development Corporation Limited vs. Avishek Gupat & Ors." which was filed by the Appellant challenging the order dated 04.01.2024 approving the Resolution Plan has been decided by our order of the date. We by our order has upheld the order dated 04.01.2024 as well as the reliefs and concessions granted by the order that Corporate Debtor shall continue to give unfettered access to all its assets, including movable assets located on properties that do not belong to the Corporate Debtor on the same term. However, while upholding the order, this Tribunal has granted certain liberties and the Appeals have been disposed of by order of the date. It is useful to extract paragraph 13 of the judgment of Company Appeal (AT) (Insolvency) No. 70 of 2024, which is as follows:-

"13. The Resolution Plan having been approved by 100% vote share of the CoC and no grounds having been made out to interfere with the approval of the Resolution Plan within the meaning of Section 30, Company Appeal (AT) (Insolvency) No. 491 of 2024 7 sub-section (2) to establish that Resolution Plan violates any provision of Section 30 sub-section (2) of the Code, we see no reason to interfere with the impugned order approving the Resolution Plan. However, as observed above, approval of Resolution Plan and grant of reliefs and concessions under paragraph-9 (7) as extracted above, does not fetter the right of the parties to enter into an arrangement with regard to shared utilities and equipment, which are located outside the lease hold land of the Corporate Debtor and further, the approval of Resolution Plan and grant of above reliefs and concessions does not fetter the rights of the parties to establish their rights and obligations in a competent Court. Subject to liberty as aforesaid, we uphold the impugned order dated 04.01.2024 passed by the Adjudicating Authority. The Appeal is disposed of accordingly. Parties shall bear their own costs."

9. We having upheld the Resolution Plan and granted liberty, as noted above, are of the view that both the parties to act in pursuance of the liberty as granted aforesaid and the order dated 23.02.2024 being only an interim direction and the application being still pending, we see no reason to entertain this Appeal. While disposing of the application IA No.435 of 2024, Adjudicating Authority shall take into consideration the judgment of this Tribunal of the date in Company Appeal (AT) (Insolvency) No.70 of 2024 as contained in paragraph 13 of the judgment.

Company Appeal (AT) (Insolvency) No. 491 of 2024 8

10. Subject to the above observations and directions, this Appeal is disposed of.

[Justice Ashok Bhushan] Chairperson [Barun Mitra] Member (Technical) [Arun Baroka] Member (Technical) New Delhi Anjali Company Appeal (AT) (Insolvency) No. 491 of 2024

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National Company Law Appellate Tribunal