The position of an agent of Receiver cannot be termed as possession or occupation contemplated by Section 14(1)(d) of the IBC – Urshila Ajit Kerkar Vs. Office of the Court Receiver, High Court, Bombay & Anr. – Bombay High Court
Hon’ble High Court held that:
(i) on meaningful reading of Section 14(1)(d), it is clear that recovery of property by owner/lessor where such property is “occupied by” corporate debtor is not permissible when a moratorium under IBC is declared. Section 14(1)(d) does not deal with any of the assets or legal right or beneficial interest in such assets of the corporate debtor, but what is referred to therein is the “recovery of any property”. Moreover, the bar under clause (d) is attracted only when the owner or lessee is seeking recovery of property. In the facts of the case, the receiver is seeking property from an agent of the receiver on default of payment of royalty amount. Such proceedings cannot termed as proceedings for the recovery of property by the owner or lessee.
(ii) However, possession of the receiver’s agent cannot be termed as an asset of a company. Applying section 14 of the IBC to the receiver’s agent would amount to reading something into statute that the legislature never intended. However, in the facts of the case, having recorded a finding that the possession of the agent cannot be termed as possession within the meaning of Clause (d) of Section 14 (1) of the IBC, it is not necessary to deal into detail the implications of Section 14 of the IBC.
