MR. RAJENDRA K. BHUTTA versus MAHARASHTRA HOUSING AND AREA DEVELOPMENT AUTHORITY THROUGH ITS CHAIRMAN & ANR.

MR. RAJENDRA K. BHUTTA versus MAHARASHTRA HOUSING AND AREA DEVELOPMENT AUTHORITY THROUGH ITS CHAIRMAN & ANR.

Because the Joint Development Agreement and Deed of Modification granted the corporate debtor a licence to enter onto and to implement development works on the land, the corporate debtor was 'occupying' the property in the sense of Section 14(1)(d) of the Insolvency and Bankruptcy Code, 2016; accordingly the...

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Parties
Appellant / Interim Resolution Professional: MR. RAJENDRA K. BHUTTA; Respondent: MAHARASHTRA HOUSING AND AREA DEVELOPMENT AUTHORITY THROUGH ITS CHAIRMAN & ANR.
Jurisdiction
India
Judgment Date
19 February 2020
Procedural Posture
Civil Appeal / Appeal Against Order of the National Company Law Appellate Tribunal; Final Judgment by the Supreme Court
Outcome
Appeal allowed; impugned order of the NCLAT set aside
Legal Topics
Moratorium Under S.14(1)(d) of the Insolvency and Bankruptcy Code, 2016, Interpretation of Joint Development Agreement, Meaning of 'occupied By' Vs 'possession', Conflict Between MHADA Act and IBC (s.238)
Insolvency and Bankruptcy Property Law Contract Law Statutory Interpretation Moratorium Under S.14(1)(d) of the Insolvency and Bankruptcy Code, 2016 Interpretation of Joint Development Agreement Meaning of 'occupied By' Vs 'possession' Conflict Between MHADA Act and IBC (s.238)

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Parties

MR. RAJENDRA K. BHUTTA

Appellant / Interim Resolution Professional

MAHARASHTRA HOUSING AND AREA DEVELOPMENT AUTHORITY THROUGH ITS CHAIRMAN & ANR.

Respondent

Procedural Posture

Civil Appeal / Appeal Against Order of the National Company Law Appellate Tribunal; Final Judgment by the Supreme Court

Legal Issues

  1. 1 Whether Section 14(1)(d) of the Insolvency and Bankruptcy Code, 2016 bars recovery of property by an owner/lessor where a corporate debtor has been granted a licence/occupation under a Joint Development Agreement
  2. 2 What is the legal meaning of the expression 'occupied by' in s.14(1)(d) and how it differs from 'possession'
  3. 3 Whether provisions of the Maharashtra Housing and Area Development Act, 1976 can override the moratorium under s.14 of the Code

Ratio Decidendi

Because the Joint Development Agreement and Deed of Modification granted the corporate debtor a licence to enter onto and to implement development works on the land, the corporate debtor was 'occupying' the property in the sense of Section 14(1)(d) of the Insolvency and Bankruptcy Code, 2016; accordingly the recovery of possession by MHADA was subject to the moratorium and the NCLAT's conclusion to the contrary was set aside; the matter was remitted to the NCLT to decide the resolution professional's application within a directed timeframe.

Court Disposition

Appeal allowed; impugned order of the NCLAT set aside

Orders

  • Impugned NCLAT order dated 14.12.2018 is set aside
  • The National Company Law Tribunal is directed to dispose of the resolution professional’s application (I.A. No.21433/2018) within six weeks from the date of this judgment