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Initially entered into an agreement for purchase of flat and subsequently advance paid was converted into a loan, cannot change the basic nature of transaction and Financial Creditor will remain an allottee within the meaning of Sec. 2(d) of the RERA Act, 2016 and is required to comply proviso to Section 7(1) of IBC to initiate CIRP – Shreepati Build Infra Investment Ltd. Vs. Abhiyan Developers Pvt. Ltd. – NCLT Mumbai Bench

In this case, the Financial Creditor entered into an agreement with the Corporate Debtor for purchase of flat after the payment of a sum of Rs. 3,50,00,000/-. However, as all the permissions and/or approvals were not sought properly, the Corporate Debtor was unable to commence the construction for the same. Subsequently, the said amount was converted into a loan account by the Corporate Debtor and the same was to be repaid along with the agreed interest.
NCLT Mumbai Bench held that:
(i) Any agreement cannot change the basic nature of transaction and the Financial Creditor over here will remain an allottee within the meaning of Section 2(d) of the RERA Act, 2016.
(ii) The main Company Petition in the instant case was filed by a single allottee. The Applicant has not taken any steps to comply with the amended provisions of Section 7 of the Code, and the application is, therefore, deemed to be withdrawn before admission or the petition could have been filed jointly by not less than one hundred allottees or not less than 10% of the total number of allottees under the same real estate project.

Initially entered into an agreement for purchase of flat and subsequently advance paid was converted into a loan, cannot change the basic nature of transaction and Financial Creditor will remain an allottee within the meaning of Sec. 2(d) of the RERA Act, 2016 and is required to comply proviso to Section 7(1) of IBC to initiate CIRP – Shreepati Build Infra Investment Ltd. Vs. Abhiyan Developers Pvt. Ltd. – NCLT Mumbai Bench Read Post »

Delineating the “Laxman Rekha” for constitutional courts under the Section 34 of the Arbitration and Conciliation Act, 1996 – M/s. A.G. Enviro Infra Projects Pvt. Ltd. Vs. M/s. J.S. Enviro Services Pvt. Ltd. – Delhi High Court

The decision of the Hon’ble High Court is summarised in the following points:
(i) The conclusion of an Arbitrator on facts, even if erroneous in the opinion of the Court cannot be interfered with.
(ii) It is a settled law that under Section 34 of the Act, 1996, the Award cannot be challenged on the merits.
(iii) The constitutional courts do not possess the unbridled power to interfere unnecessarily with the award
(iv) Section 34 shall be applicable only when the arbitrator shall construe the terms of the contract which cannot be construed in accordance with the eyes of the reasonable person.
(v) The Arbitrator is the sole umpire of that game and the legislative mandate clearly propounds that the constitutional courts cannot unnecessarily interfere in the reasoning and decision of the Arbitrator.
(iv) Constitutional should keep in mind the ‘Lakshman Rekha‘ imposed on the powers of the courts while addressing the challenge to the Arbitral Award under Section 34 of the Act.

Delineating the “Laxman Rekha” for constitutional courts under the Section 34 of the Arbitration and Conciliation Act, 1996 – M/s. A.G. Enviro Infra Projects Pvt. Ltd. Vs. M/s. J.S. Enviro Services Pvt. Ltd. – Delhi High Court Read Post »

Appellant who has filed an Appeal under Section 61 of IBC is entitled benefit u/s 14 of the Limitation Act, 1963 for proceeding in the High Court under Article 226 which writ proceedings were also dismissed on the ground of availability of the alternative remedy – Vikram Bhawanishankar Sharma, Member of the Suspended Board of Directors of Supreme Vasai Bhiwandi Tollways Pvt. Ltd. Vs. SREI Infrastructure Finance Ltd. & Anr. – NCLAT New Delhi

NCLAT observed that the Appellant filed writ petition at the time when there was no notice of any sitting of Vacation Bench in the winter vacation of Appellate Tribunal. Impugned Order has been passed on 22.12.2022 and uploaded on 23.12.2022, it can not be denied that there was urgency on the part of the Appellant for obtaining immediate relief hence it can not be said that filing of writ petition by the Appellant before the Hon’ble High Court was not bona fide. Kalpraj Dharamshi (2021) ibclaw.in 40 SC itself was a case where benefit of Section 14 of the Limitation Act was claimed on the ground that proceedings under Article 226 were being prosecuted in the Hon’ble Bombay High Court which benefit was extended by the Hon’ble Supreme Court and which benefit as per Judgment of Hon’ble Supreme was clearly admissible to any Appeal under Section 61 of the Code. The Judgment of the Hon’ble Supreme Court in Kalpraj Dharamshi (supra) being judgment directly applicable in the facts of the present that i.e. exclusion of period during which the Writ Petition was being prosecuted by the Appellant in an Appeal filed under Section 61 of the Code, we are of the view and feel ourselves bound to follow the Judgment of Supreme Court.

Appellant who has filed an Appeal under Section 61 of IBC is entitled benefit u/s 14 of the Limitation Act, 1963 for proceeding in the High Court under Article 226 which writ proceedings were also dismissed on the ground of availability of the alternative remedy – Vikram Bhawanishankar Sharma, Member of the Suspended Board of Directors of Supreme Vasai Bhiwandi Tollways Pvt. Ltd. Vs. SREI Infrastructure Finance Ltd. & Anr. – NCLAT New Delhi Read Post »

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