Disposed

Assets Reconstruction Company India Limited v. the Official Liquidator

DRT18 Jul 2023MA/43/2023

Case brief

AI extract

What is this about?

MA filed by ARCIL seeking transfer of Recovery Proceeding No. 415/2002 from Recovery Officer-I to Recovery Officer-II to consolidate with merging proceeding No. 196/2003 involving same immovable properties under their custody.

What did the court decide?

Direction to transfer Recovery Proceeding No. 415/2002 from Recovery Officer-I to Recovery Officer-II, Mumbai, with immediate effect.

Assets Reconstruction Company India Limited versus the… — Company and Corporate | DRT (2023)

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18/07/2023	Ex. No.	Before Presiding Officer Dr. Rekha G. Dhakar, DRT-1, Mumbai. *Roznama in MA 43 of 2023* *Assets Reconstruction Company India* *Limited Vs The Official Liquidator*	Next date
		Advocate Mr. Rohit Gupta a/w Advocate Mr. Nikhil Rajani i/b V. Deshpande & Co. appeared for the Applicant. Advocate Ms. Neha Chhajalane appeared for the Official Liquidator, High Court, Mumbai. 1. By way of the present MA, Applicant is seeking transfer of RC No. 415/2002,
		from Recovery Officer-I, DRT-1, Mumbai, to Recovery Officer-II, DRT-1, Mumbai and tag along with the recovery proceeding No. 196/2003. 2. facts as narrated in the MA are that:- i) By an order dated 24/08/2022, the Learned Recovery Officer-II, disposed of Misc. Application No. 1196 of 2022, with a direction to Official Liquidator to hand over the immovable properties of the Company (In Liqn) bearing Survey Nos. 90 to 103, 139 to
		170, 172 to 235, 242, 257 to 260, 265 to

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	271, 273 and 443 admeasuring about 1,004,256 square metres together with
	all building and structures, all plant and machinery attached to the earth or permanently fastened to anything
	attached to the earth and a Receiver
	came to be appointed as the Receiver
	for the said purpose.
ii)	In view of the aforesaid order, the
	Official Liquidator filed its report in
	the Hon’ble High Court viz: Official
	Liquidator Report No. 137 of 2022 to
	seek directions to hand over the
	possession of the above referred
	property, which is in Official
	Liquidator’s possession to DRT
	Receiver on “as is where is and
	whatever there is basis”. In the said
	report, the Official Liquidator asserted
	that it was in possession of a land
	admeasuring 4,87,158.13 square
	metres (larger parcel of land) and
	another parcel of land admeasuring
	4416.96 square metres, (subject land)
	handed over by the Court Receiver to
	the Official Liquidator pursuant to the

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order dated 30/08/2019 passed by the Hon’ble High Court, Bombay in Company Application No. 331 of 2019. Thus, the Official Liquidator cannot hand over the land admeasuring 1,004,256 square metres to DRT Receiver, since Official Liquidator was in possession of land admeasuring to 4,91,575.09 square metres only. iii) The aforesaid Official Liquidators Report was heard at length by the Hon’ble High Court Bombay wherein the issues raised by the Creditors. In the meantime, on or about 08/08/2019 when the aforesaid recovery proceedings was listed on board before the Learned Recovery Officer attached to this Tribunal, since the matter was seized off by the Hon'ble High Court Bombay and since the properties of the Borrower Company (In Liqn) were in possession of the Official Liquidator attached to the Hon'ble High Court, Bombay and the said Official was Liquidator attempting to sell the said properties,

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the Learned Recovery Officer has proceeded to close the aforesaid recovery proceedings, with a liberty to the Applicant to apply for reopening of the same as and when they deem fit and necessary. The Applicant has been standing outside the liquidation proceedings and was all along participating in the proceedings pending before the Hon'ble High Court Bombay along with other lenders wherein the properties of the Borrower Company (In Liqn) was being put up for sale. iv) The Applicant stated that for a considerable period of time, the proceedings before the Hon'ble High Court Bombay was being conducted and even the Official Liquidator made three attempts to sell the said properties of the Company (In Liqn). However, all those attempts did not fructify as no offers were received. v) The Applicant stated that while the Official Liquidator was in the process of liquidation, Invent Asset

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Securitisation & Reconstruction Pvt. Ltd., a secured creditor of the Company (In Liqn), preferred Misc. Application No. 1196 of 2022, in Recovery Proceeding No.196 of 2003, pending before the Learned Recovery Officer - I, Debts Recovery Tribunal I. Mumbai seeking, inter alia directions to the Official Liquidator to hand over possession of the immovable properties of the Company (In Liqn), to the Learned Recovery Officer - II, of this Tribunal or to a private receiver as may be appointed by the said Recovery Officer the Company (In Liq), the Workmen, the State Government and the Liquidator was considered. vi) By an order dated 01/12/2022 passed by the Hon'ble High Court, Bombay, the Official Liquidator Report was allowed and the Hon'ble High Court, Bombay was pleased to permit the Official Liquidator to handover possession of land which Official Liquidator was in possession to the

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Receiver appointed by this Hon'ble Tribunal on "As is where is and Whatever there is basis" and permit the Official Liquidator to withdraw the security." By the said order, it was further directed that the Learned Recovery Officer shall determine the aspect of distribution of the assets of the Company (In liq) in terms of the provisions of Sections 529 and 529A of the Companies Act, 1956 and the judgments passed by the Hon'ble Supreme Court. vii) The Applicant stated that in terms of the aforesaid Order, the Official has handed over Liquidator possession to the Receiver appointed by the Learned Recovery Officer II, of this Tribunal and the said property is custodia legis the Receiver in the Recovery Proceedings No. 196 of 2003. The Applicant stated that in pursuance of handing over possession of the said properties to the Receiver appointed by the Learned Recovery Officer - II, the security guards are

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appointed to guard the said properties and further steps for sale being taken in the said Recovery Proceedings. The Applicant stated that the sale proceeds realised from sale of the said properties will insure to the benefits of all the lenders and the workmen together and thus it is imperative that common steps for sale of the said properties be taken collectively by all the lenders. viii) The Applicant stated that in the interregnum, and since the proceedings before the Hon'ble High Court culminated into handing over possession of the secured assets to the Receiver appointed by this Tribunal, on an application made by the Applicant, the Learned Recovery Officer - 1, being in charge of the matter activated the Recovery Proceedings of the Applicant. In furtherance thereof, by an order dated 10/05/2023, the said Learned Recovery Officer - 1, proceeded to issue a warrant of attachment on the

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	above referred properties with a further direction to conduct valuation of the said properties.
ix)	Further it is stated that by ordering to
	conduct valuation of the above
	referred properties causes duplication of process and expenses more so when
	the property is_custodia legis_the
	Tribunal Receiver appointed by the
	coordinate Recovery Officer of this
	Tribunal.
x)	Besides, the Recovery Proceedings are
	activated at the instance of Invent
	ARC in whose proceedings further
	steps are being taken in respect of the
	said properties, and therefore the
	proceeding with attachment and sale
	in the Recovery Proceeding of the
	Applicant may not fructify as the
	property is already_custodia legis_and may amount to overreaching the order passed by coordinate Recovery Officer of this Tribunal.
3.	Having heard the Parties present and
	gone through the record.

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Looking to the facts mentioned in the present MA that two recovery proceedings are pending with this Tribunal i.e. recovery proceeding no. 196/2003 as well as Recovery Proceeding No. 415/2002 wherein same immovable properties in question are part of both the Recovery Proceeding (RC) and both the RCs are pending before the two different Recovery Officer of this Tribunal therefore, in the interest of justice it would be appropriate that both the RCs may be decided by one Recovery Officer only therefore, it is hereby directed that Recovery Proceeding No. 415/2002 pending with Recovery Officer-I, DRT-1, Mumbai may be transfer to the Recovery Officer-II DRT-1, Mumbai with immediate effect. 5. With the above said direction this MA is disposed off. Copy of this order be sent to both Recovery Officers of this Tribunal. File be closed and consigned to record room. P.O. DRT-I

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Assets Reconstruction Company India Limited v. the Official Liquidator

Case brief

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Assets Reconstruction Company India Limited v. the Official Liquidator

Case brief

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