Allowed

In the matter of Ats Heights Private Limited [Inv. Pett.-88-2023, IA-576-2024 and IA-1382-2024 in Company Petition No. (IB)-570(ND)-2023]

NCLT22 Apr 2024Inv. Pett.-88-2023, IA-576-2024 and IA-1382-2024 in Company Petition No. (IB)-570(ND)-2023

Case brief

AI extract

What is this about?

The Tribunal admitted an application under Section 7 of the IBC for initiation of CIRP against a corporate debtor. The Court held that financial creditors could trigger CIRP based on defaults owed to other financial creditors, emphasizing that acknowledged defaults in financial statements are sufficient for admission despite debtor disputes.

What did the court decide?

The application under Section 7 for initiation of CIRP was admitted; an IRP was appointed; moratorium was declared; and a Monitor was appointed to oversee the process.

In the matter of Ats Heights Private Limited [Inv… — Company and Corporate | NCLT (2024)

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NATIONAL COMPANY LAW TRIBUNAL NEW DELHI BENCH (COURT-II)

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Inv. Pett.—88/2023, IA—576/2024 and IA—1382/2024 IN Company Petition No. (IB)-570(ND)/2023

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IN THE MATTER OF (IB)-570(ND)/2023: (Section: 7 of IBC, 2016)

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1. ASK Trusteeship Services Private Limited

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(Through ASK Property Investment Advisors Private Limited) Having its registered office at:

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Birla Aurora, Level 16, Office Floor 9,

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Dr. Annie Besant Road, Worli, Mumbai-400030

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2. ASK India Real Estate Special Opportunities Fund PTE Ltd

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Having its registered office at: 101, Cecil Street, 18-12, Tong Eng Building, Singapore-069533

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3. ASK Investment Managers Limited

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(earlier known as ASK Investment Managers Private Limited) Having its registered office at: Birla Aurora, Level 16, Office Floor 9,

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Dr. Annie Besant Road, Worli, Mumbai-400030

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… Applicants/ Financial Creditors

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Versus

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ATS Heights Private Limited

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Having its registered office at: 711/92, Deepali, Nehru Place, New Delhi-110019

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… Respondent/ Corporate Debtor

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AND IN THE MATTER OF INV. PETT. NO. 88/ND/2023: (Section: 60(5) of IBC, 2016 r/w Rule 11 of NCLT Rules, 2016)

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ATS Knightsbridge Buyer Welfare Association Plot No. A, 01/A, Sector 124, Noida, Uttar Pradesh-201305 … Applicant/Intervenor

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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Page 1 of 72

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AND IN THE MATTER OF IA. NO. 576/ND/2024: (Section: 60(5) of IBC, 2016)

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ATS Heights Private Limited Having its registered office at: 711/92, Deepali, Nehru Place, New Delhi-110019

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... Applicant/ Corporate Debtor

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Versus

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1. Ask Trusteeship Services Private Limited

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(Through ASK Property Investment Advisors Private Limited) Having its registered office at: Birla Aurora, Level 16, Office Floor 9,

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Dr. Annie Besant Road, Worli, Mumbai-400030

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2. Ask India Real Estate Special Opportunities Fund PTE Ltd

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Having its registered office at: 101, Cecil Street, 18-12, Tong Eng Building, Singapore-069533

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3. ASK Investment Managers Limited

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(earlier known as ASK Investment Managers Private Limited) Having its registered office at:

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Birla Aurora, Level 16, Office Floor 9,

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Dr. Annie Besant Road, Worli, Mumbai-400030 … Non-Applicants/

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Financial Creditors

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AND IN THE MATTER OF IA. NO. 1382/ND/2024: (Section: 16(2) & 60(5) of IBC, 2016 r/w Rule 11 of NCLT Rules, 2016)

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1. ASK Trusteeship Services Private Limited

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(Through ASK Property Investment Advisors Private Limited) Having its registered office at: Birla Aurora, Level 16, Office Floor 9,

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Dr. Annie Besant Road, Worli, Mumbai-400030

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2. ASK India Real Estate Special Opportunities Fund PTE Ltd

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Having its registered office at: 101, Cecil Street, 18-12, Tong Eng Building, Singapore-069533

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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Page 2 of 72

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3. ASK Investment Managers Limited

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(earlier known as ASK Investment Managers Private Limited) Having its registered office at:

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Birla Aurora, Level 16, Office Floor 9,

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Dr. Annie Besant Road, Worli, Mumbai-400030 … Financial Creditors/

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Applicants

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Versus

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ATS Heights Private Limited

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Having its registered office at: 711/92, Deepali, Nehru Place, New Delhi-110019 … Corporate Debtor/ Respondent

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Order Delivered on: 22.04.2024

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CORAM:

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SH. ASHOK KUMAR BHARDWAJ, HON’BLE MEMBER (J) SH. SUBRATA KUMAR DASH, HON’BLE MEMBER (T)

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PRESENT:

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For the Petitioner : Sr. Adv. Arun Kathpalia, Adv. Diksha Gupta, Adv. Arunav Guha Roy, Adv. Anushree Poddar For the Respondent : Adv. Divyansh Rai, Adv. Krish Kalra For the Intervener : Sr. Adv. Mohapathy Ganesh, Adv. Sandeep Chilana, Adv. Abdullah Tanveer, Adv. Anjali Jain

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ORDER

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The captioned petition has been jointly preferred by ASK Trusteeship Services Private Limited representing ASK Real Estate Special Opportunities Fund and ASK Real Estate Special Opportunities Fund II in capacity of being its investment manager, ASK India Real Estate Special Opportunities Fund PTE Ltd and ASK Investment Managers Limited (collectively referred to as “ ASK Entities/Petitioners ”) for initiation of CIRP qua the Corporate Debtor/

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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Respondent i.e. ATS Heights Private Limited . The petition has been preferred for initiation of CIRP qua the CD on account of the default committed by it in redeeming the debentures issued by it, in terms of the deed entered into between the parties in this regard.

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It is the case of the Petitioners that the Financial Creditor advanced an aggregate principal amount of Rs. 285,00,00,000/- in two rounds to the CD by way of subscription to debentures categorised as optionally convertible debentures ( “OCD” ) and non-convertible debentures ( “NCD” ) in first round and another round of NCD categorised as “Senior NCDs” to finance real estate project being developed by the CD namely ‘ATS Knightsbridge’ situated in Noida, Uttar Pradesh. The Petitioners/Financial Creditors have further espoused that the OCDs, NCDs and the Senior NCDs ( “Debentures” ) qualify as “financial debt” within the meaning of Section 5(8)(c) of the code and the Financial Creditors fall within the meaning of “financial creditor(s)” as provided under section 5(7) of the code.

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The Petitioners submitted that the default has also been committed by the CD in repayment of the financial debt owed by it to its another financial creditor viz. Piramal Capital & Housing Finance Limited (“Piramal”). The CD solicited financial assistance from Piramal under three distinct facilities viz:

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a. Debenture Subscription of Rs. 215,00,00,000/- from Piramal ( ‘Piramal

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Facility 1’ ) by way of Debenture Trust Deed dated 29.01.2016 executed between CD and IDBI Trusteeship Services Limited (debenture trustee for

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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Piramal debentures). CD issued upto 21,500 redeemable, secured, unlisted, non-convertible debentures of a face value of Rs. 1,00,000/- each.

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b. Term loan of Rs. 275,00,00,000/- (Rupees Two Hundred and Seventy-Five Crores) from Piramal ( ‘Piramal Facility 2’ ) vide loan agreement dated 21.09.2018 executed inter alia between the Corporate Debtor and Piramal.

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c. Emergency Credit Line Guarantee Scheme of Rs. 47,15,00,000/- (Rupees Forty Seven Crores and Fifteen Lakhs Only) from ( ‘Piramal Facility 3’ ) via loan agreement dated 08.08.2022 executed inter alia between the Corporate Debtor and Piramal.

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It is the case of the Applicants that the Piramal Facility 1, Piramal Facility 2 and Piramal Facility 3 qualify as ‘financial debt’ in terms of the provisions of Section 5(8) of the code and that the CD failed to make requisite scheduled repayments qua the same which is evident from the credit rating of the CD dated 28.07.2023 issued by the Credit Information Bureau (India) Limited which reflected an outstanding amount of Rs. 72,25,98,554 against the principal amount of Piramal Facility 2 and an outstanding amount of Rs. 47,15,00,000 against the Piramal Facility 3. Further, the CD also defaulted in repayment of Piramal Facility 1 which is evident by the statement of account issued by Piramal qua the said facility up till 31.05.2023. The said statement of account reflects the amount of Rs. 3,19,53,279/- as interest overdue and an amount of Rs. 14,66,50,566/- as principal amount outstanding against the Piramal Facility 1 as on 31.05.2023.

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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The CIBIL Report further reflects that the Piramal Facility 1 and Piramal Facility 2 have been assigned by Piramal to JM Financial Asset Reconstruction Company ( “ARC” ). The factum of assignment of the two facilities has been confirmed by the CD vide its e-mail dated 22.08.2023. As per Reserve Bank of India (Transfer of Loan Exposure) Directions, 2021 (as updated on 05.12.2022), stressed loans “which are in default” are transferred to an ARC. Hence, the assignment of Piramal Facility 1 and Piramal Facility 2 to the ARC establishes that defaults have been committed by the CD qua the said facilities thereby necessitating such assignment by Piramal.

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The CIBIL Report and the factum of assignment of the two debts to ARC confirm that the CD defaulted in repayment of amounts under Piramal Facility 1 and Piramal Facility 2, thus it committed default under Explanation to Section 7(1) of IBC, 2016 has occurred.

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It is also the case of the Petitioner that the CD defaulted in repayment of the financial debts owed to the Financial Creditors as the OCDs and NCDs amounting to Rs 200 Crores subscribed by Financial Creditors which were to be redeemed by 07.03.2023 and Senior NCDs amounting to Rs. 85 Crores subscribed to by the Financial Creditors were to be redeemed by the CD by 30.06.2023. The CD did not redeem the said Debentures till date and therefore, the Debentures subscribed to by the Financial Creditor are due and payable as on date. Therefore, without prejudice to the above, the CD is admittedly in default of the other financial debts owed by the Corporate Debtor to the Financial Creditors.

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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Per contra, in the reply filed by it, the Respondent/CD has espoused that the purported default as alleged by the Financial Creditors in the present proceedings is a figment of its imagination and is an attempt to coerce the Respondent to payout sums to the alleged Financial Creditors which are otherwise not due and payable by the Respondent to the alleged Financial Creditor.

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It is also the plea raised by the Corporate Debtor that the Petitioner is alleging the default which has not even been alleged by the Piramal Capital and Housing Finance Limited or its assignee i.e. JM Financial Asset Reconstruction Company. According to it, the assignee i.e. JM Financial Asset Reconstruction Company, in co-operation with the Respondent is restructuring the facilities availed by the Respondent from Piramal.

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Besides the aforementioned, the Respondent raised the following other issues:-(i) the institution of the present proceedings for default of third party, apart from being not maintainable is in bad faith; (ii) non-initiation of CIRP either by Piramal or JM Financial Asset Reconstruction Company, by filing any application under Section 7 of IBC, 2016, is proof of the fact that the Respondent is going concern and capable of fulfilling its financial obligations; (iii) the purported application have been filed by the alleged financial creditor for default of a purported debt which admittedly has not been disbursed by the financial creditor to the Respondent; (iv) once the alleged financial creditor/ASK entities have already filed an application bearing C.P. (IB) No. 569 of 2023 under the

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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provisions of Section 7 of the Code against the Respondent, the present application qua the same alleged default in repayment of financial debt cannot be maintained; (v) from the perusal of the application and the documents enclosed therewith, it is revealed that the alleged financial creditor before instituting the present application against the Respondent for default in repaying the alleged financial debt extended to it by Piramal has not even intimated either Piramal or JM Financial Asset Reconstruction Company regarding the present proceedings; (vi) Piramal or JM Financial Asset Reconstruction Company has not even been impleaded as party to the present proceedings, thus the application is not maintainable; (vii) the Applicants being not financial creditors, but being only speculative investors could not have instituted the present proceedings; (viii) neither the Applicants are financial creditors nor the sums being claimed to be due constitute debts; (ix) owing to the subsistence of the force majeure which covid-19, the timelines under the Agreements for making the alleged payments stands extended w.e.f. March 2020 and continues till date; (x) no demand of amount of debt was ever made by the Creditor; (xi) even if the redemption of the outstanding debentures were to be made on 07.06.2023 and was not made, the non-redemption would not constitute any default, in view of the provisions of Section 10A of IBC, 2016; (xii) on many occasions the financial creditor/ASK Entities did not release any funds at all for operating and construction expenses in blatant dis-regard of the Project’s need and committed possession timelines to the customers and various other stakeholders.

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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We heard the counsels for the parties and perused the record. As far as the issue of filing the petition, regarding the default of third party is concerned, as can be seen from explanation to Section 7(1) of IBC, 2016, for the purposes of sub-Section 1 of Section 7, a default includes even the one in respect of a financial debt owed not only to the Applicant Financial Creditor but also to any other financial creditor to the Corporate Debtor. The explanation reads thus:-

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“ 7. Initiation of corporate insolvency resolution process by financial creditor.—

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Explanation.—For the purposes of this sub-section, a default includes a default in respect of a financial debt owed not only to the applicant financial creditor but to any other financial creditor of the corporate debtor.”

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Besides, the Section 7(1) of IBC, 2016, categorically provides that a financial creditor either by itself or jointly with (other financial creditors, or any other person on behalf of the financial creditor, as may be notified by the Central Government) may file an application for initiating Corporate Insolvency Resolution Process against a Corporate Debtor. The Section 7(1) of the IBC, 2016, reads thus:-

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“ 7. Initiation of corporate insolvency resolution process by

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financial creditor.— (1) A financial creditor either by itself or jointly with other financial creditors, or any other person on behalf of the financial creditor, as may be notified by the Central Government, may file an application for initiating corporate insolvency resolution process against a corporate debtor before the Adjudicating Authority when a default has occurred.”

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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Also, in exercise of the powers conferred by sub-Section 1 of Section 7 of the Insolvency and Bankruptcy Code, 2016 (31 of 2016), the Central Government has notified certain persons who may file an application for initiating Corporate Insolvency Resolution Process against a Corporate Debtor before the Adjudicating Authority on behalf of the financial creditor. The authorities includes a trustee (including a Debenture Trustee). The notification dated 27.02.2019 reads thus:-

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“ MINISTRY OF CORPORATE AFFAIRS NOTIFICATION

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New Delhi, the 27th February, 2019

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S.O. 1091(E).- In exercise of the powers conferred by sub-section (1) of section 7 of the Insolvency and Bankruptcy Code, 2016 (31 of 2016), the Central Government hereby notifies following persons who may file an application for initiating corporate insolvency resolution process against a corporate debtor before the Adjudicating Authority, on behalf of the financial creditor: -

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(i) a guardian

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(ii) an executor or administrator of an estate of a financial creditor;

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(iii) a trustee (including a debenture trustee); and

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(iv) a person duly authorised by the Board of Directors of a Company”

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Even otherwise also, as can be seen from Part-IV of the application, the financial creditors had jointly extended the financial facility to the CD by way of subscription to optionally convertible debentures as well as non-convertible debenture under various security agreements. It is not so that the default is only

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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qua the subscription made to the debentures issued by the CD, only by Piramal. Apparently, the subscription to debentures was also made by the ASK Entities i.e. the Financial Creditors/ Petitioners in the present petition. The Part-IV of the application reads thus:-

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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Thus, we do not find any force in the plea/objections raised on behalf of the CD regarding the locus standi for filing the present petition.

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In view of the aforementioned analysis and discussion, we are unable to appreciate even the plea raised on behalf of the CD that how the loan initiation of CIRP either by Piramal or JM Asset Financial Reconstruction Company would come in the way of admission of the present petition. Indubitably, the Applicants are financial creditors qua the Corporate Debtor and they are entitled to institute the present proceedings not only for the debt owed to them, but also the one, owed to other financial creditor of the Corporate Debtor. Here, it would not be out of context to note that the objective of IBC, is to ensure that the CD is put back to its feet and is rescued. Thus, when as per the stand taken by the CD itself, in its reply that it suffered from financial crunch and leanness, apparently, it needs to be rescued by resorting to the available process.

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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The only reason to refer to the default qua Piramal is that the Financial Statement of ATS Heights Private Limited reflects the lapse committed in redemption of not only qua the Petitioners, but also qua the Piramal and it is only after the default committed in redemption of debenture qua Piramal that the present petition has been preferred. The clause 14 of the Financial Statement dated 31.03.2022 reads thus:-

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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18. As can be seen from the aforementioned, the NCD/OCD had got matured

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on 06.03.2023, 28.01.2023 and 07.03.2023, but the CD defaulted in redeeming

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the same.

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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The Petitioners have also placed on record the record of Financial Information-Form C and Form D reported to the NeSL as (Annexure P-44 colly) to the petition. Form D of the report viz. record of default indicates the debt, but the debtor could dispute the same. The relevant excerpts of the Form C and Form

D reads thus:-

X X X

X X X

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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X X X

X X X

X X X

Once, the CD has accepted its liability regarding redemption of debentures

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in its Financial Statements dated 31.03.2022, it is difficult to accept its plea

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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regarding there being no debt and default. There is no requirement in terms of the IBC to implead all the financial creditors as the parties to the application filed under Section 7 of the IBC, 2016 and on commencement of CIRP, in terms of the provisions of Regulations 6, 6A, 7, 8, 8A, 9 and 9A of the IBBI (Resolution Process for Corporate Persons) Regulations 2016, all the claimants including the financial creditors may stake their claim before RP. Thus, the plea of non-joinder of necessary parties raised by the Corporate Debtor is nixed.

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In terms of the provisions of Section 5(8)(c) of IBC, 2016, the plea of the Applicant being not Financial Creditor and only a speculative inspector cannot be accepted. The Section 5(8)(c) (ibid) clearly provides that a financial debt means

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any amount raised pursuant to debenture inter alia. The provisions reads thus:-

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“ Section 5. Definitions.—

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(8) financial debt means a debt along with interest, if any, which is disbursed against the consideration for the time value of money and includes—

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(a) money borrowed against the payment of interest;

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(b) any amount raised by acceptance under any acceptance credit

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facility or its de-materialised equivalent;

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(c) any amount raised pursuant to any note purchase facility or the issue of bonds, notes, debentures, loan stock or any similar instrument;

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(d) the amount of any liability in respect of any lease or hire purchase contract which is deemed as a finance or capital lease under the Indian Accounting Standards or such other accounting standards as may be prescribed;

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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(e) receivables sold or discounted other than any receivables sold on non-recourse basis; (f) any amount raised under any other transaction, including any forward sale or purchase agreement, having the commercial effect of a borrowing;

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[Explanation----For the purposes of this sub-clause,--

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(i) any amount raised from an allottee under a real estate project shall be deemed to be an amount having the commercial effect of a borrowing; and

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(ii) the expressions, allottee and real estate project shall have the meanings respectively assigned to them in clauses (d) and (zn) of section 2 of the Real Estate (Regulation and Development) Act, 2016 (16 of 2016);]

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(g) any derivative transaction entered into in connection with protection against or benefit from fluctuation in any rate or price and for calculating the value of any derivative transaction, only the market value of such transaction shall be taken into account;

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(h) any counter-indemnity obligation in respect of a guarantee, indemnity, bond, documentary letter of credit or any other instrument issued by a bank or financial institution;

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(i) the amount of any liability in respect of any of the guarantee or indemnity for any of the items referred to in sub-clauses (a) to (h) of this clause;”

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Regarding the plea of Section 10A of IBC, 2016, it is seen that the application under Section 7 of IBC, 2016, could not have been filed where default could arise between 25.03.2020 to 24.03.2021. In the present case, the default

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Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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occurred on 06.03.2023, 28.01.2023 and 07.03.2023, thus it cannot be held that the present petition is barred by Section 10A of IBC, 2016.

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Regarding the plea of force majeure, we find that in the reply filed by it, the Corporate Debtor has taken four different pleas viz:- (i) the Petitioners are not financial creditors and they have filed the present petition for the default committed by some other financial creditor; (ii) the CD has not committed any default; (iii) the Petitioners did not extend the financial assistance when needed by the CD and (iv) the CD could not continue with construction on account of force majeure i.e. Covid-19. Such contradiction writ large from Paras 3-5, 7-10, 13-15 and 18-63 of the reply which reads thus:-

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“3. It is submitted that the alleged Financial Creditors/ASK Entities have not approached this Hon’ble Tribunal with clean hands and have suppressed material facts to mislead and prejudice the mind of this Hon’ble Tribunal. In fact, the alleged Financial Creditor have instituted the present application to harass the Respondents and prosecute the Respondents for an alleged default which has not been asserted or claimed by Piramal Capital & Housing Finance Limited (“ Piramal ”) or the assignee i.e., JM Financial Asset Reconstruction Company. On the contrary it is submitted that JM Financial Asset Reconstruction Company, the assignee of the financial facilities in cooperation with the Respondent is restructuring the facilities availed by the Respondent from Piramal. Therefore, the institution of the accompanying proceedings for a default of a third party against the Respondent apart from not being maintainable is in bad faith.

¶179

4. In furtherance to the aforesaid it is submitted that the purported default as alleged by the Financial Creditors/ASK Entities in the

¶180

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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present proceedings is a figment of its imagination and merely an attempt to coerce the Respondent to payout sums to the alleged Financial Creditors/ASK Entities which are otherwise not due and payable by the Respondent to the alleged Financial Creditor. Significantly, no pleadings or reasoning has been made by the alleged Financial Creditor in the purported application thereby justifying it filing the present application on behalf of Piramal or JM Financial Asset Reconstruction Company. In the absence of any pleadings the present application deserves to be dismissed. The fact, that neither Piramal or JM Financial Asset Reconstruction Company have initiated any proceedings under the provisions of IBC is proof of the fact that the Respondent is a going concern and capable of fulfilling its financial obligations.

¶183

5. Without prejudice to the aforesaid, it is submitted that the purported application has been filed by the alleged Financial Creditors for default of a purported debt which admittedly has not been disbursed by the alleged Financial Creditors to the Respondent, therefore, the present application under reply is not maintainable in law and deserves to be dismissed. Admittedly, the alleged Financial Creditor has filed the present application with ulterior motives and for purposes other than for the resolution of insolvency, therefore, in terms of Section 65 of the Code the present application deserves to be dismissed with heavy cost on the alleged Financial Creditor.

¶184

X X X

¶185

7. In addition to the aforesaid, a bare perusal of the application and the documents annexed by the alleged Financial Creditor along with application would evidence that the alleged Financial Creditor before instituting the present application against the Respondent for default of an allege financial debt extended to it by Piramal has not even intimated either Piramal or JM Financial Asset

¶186

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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Reconstruction Company regarding the present proceedings. It was incumbent on the alleged Financial Creditor to have issued a prior intimation to Piramal and JM Financial Asset Reconstruction Company regarding the present proceedings.

¶189

8. Further, the alleged Financial Creditor while filing the present application has not even made Piramal or JM Financial Asset Reconstruction Company a party to the accompanying proceedings and in their absence and on their behalf instituted the accompanying proceedings seeking admission of the Respondent to CIPR for an alleged default which is not even being asserted by Piramal or JM Financial Asset Reconstruction Company. It is submitted that both Piramal or JM Financial Asset Reconstruction Company are not just important parties but are necessary parties for effective adjudicating of the accompanying proceedings. Since, the alleged Financial Creditor has failed to implead Piramal or JM Financial Asset Reconstruction Company as party to the present proceedings the present application deserves no indulgence of this Ld. Tribunal and ought to be dismissed. Clearly, the alleged Financial Creditors have filed the present application with ulterior motives, therefore, the accompanying proceedings does not mandate any indulgence from this Ld. Tribunal.

¶190

9. Without prejudice to the aforesaid, it is further submitted that the alleged default of the alleged financial debt extended by the alleged Financial Creditor to the Respondent is in any event irrelevant for the purposes of the present application, since the cause of action of the present application is the alleged default of the alleged facilities extended by Piramal to the Respondent, which were subsequently assigned to JM Financial Asset Reconstruction Company by Piramal. In any event the alleged Financial Creditors have already invoked the jurisdiction as available under the provisions of Section

¶191

7 of the Code for the alleged default of alleged financial debt Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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extended by it to the Respondent vide C.P. (I.B.) No.569 of 2023. Hence, the varied submissions regarding the alleged default of the alleged financial debts committed by the Respondent are devoid of any merits or consideration for the purposes of the present application and in any event barred by the doctrine of res subjudice.

¶194

10. Since the alleged Financial Creditors have already invoked the jurisdiction of this Ld. Tribunal for alleged default of an alleged debt extended by them to the Respondent, which is pending before this Ld. Tribunal, adjudication of similar pleas and issues in the accompanying proceedings is an abuse of process of law and wastage of the judicial time of this Ld. Tribunal,

¶195

X X X

¶196

13. Without prejudice to the aforesaid, it is further submitted that the present Application filed by the alleged Financial Creditors is devoid of any merit and is not maintainable. The Applicants do not have any right to approach this Hon’ble Tribunal as they are not ‘ financial creditor ’ within the meaning of the Insolvency and Bankruptcy Code 2016 (‘ IBC ’) and are only ‘ speculative investors .’ The fact that the alleged Financial Creditors are just ‘ speculative investors ’ is evident from several terms and conditions of the purported Security Subscription Agreement /investment agreement relied upon by them in the present proceedings. Relevant Clauses of the Security Subscription Agreements are as follows:

¶197

“5. ASK REAL ESTATE SPECIAL OPPORTUNITIES FUND , a venture capital fund registered with Securities and Exchange Board of India bearing registration number IN/VCF/1011/0185 in form of a trust established under the Indian Trusts Act, 1882 having its principal office at Mumbai and its trustees as ASK Trusteeship Services Private Limited, a company in terms of the Companies Act, 2013 and having its registered

¶198

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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office at Birla Aurora, 16 Level, office floor 9, Dr. Annie Besant Road, Worli, Mumbai - 400030 (hereinafter referred to as "ASK RESOF" or "Investor", which expression shall, unless it be repugnant to the subject or context thereof, include its successors and/or assigns, including in the event of any inspecie distribution of assets, the beneficiaries of such distribution and their successors and assigns);”

¶201

“1. Definitions and Interpretation

¶202

1.1 Definition

¶203

aa) "Debenture Document(s)" means this Agreement, the Security Holders Agreement, the Security Documents, including the Debenture Trust Deed, and such other deeds and documents as are required for the purposes of recording the investment of, and the rights and privileges of, the Debenture Holders in and against the Company and the Promoters;

¶204

bb) "Debentures" shall mean the NCDs and the OCDs collectively and Debenture shall mean any one of them as the context may require;

¶205

cc) "Debenture Holders" shall mean the Investor and/or any other person who holds any Debenture, from time to time;

¶206

dd) “Debenture Trust Deed" shall mean a debenture trust deed executed between the Company, the Promoters and the Debenture Trustee for the benefit of the Debenture Holders;

¶207

ii) "Equity Shares" shall mean equity shares, whether Class A Equity Shares or Class B Equity Shares, of the Company of face value Rs. 10 (Rupees Ten Only);

¶208

ss) "Investor Securities" shall mean 4,000 (Four thousand) NCDs subscribed in terms of this Agreement and the 1 (One) Class B Equity Share acquired by the Investor as a condition precedent to the subscription of the NCDs, collectively and Investor Security shall mean any one of them as the context may require;

¶209

eee) "NCDs" shall mean the non-convertible debentures of face value Rs. 1,00,000 (Rupees One lakh Only) each issued/to be issued by the Company having rights, privileges and other terms as specified in the Debenture Documents, including in

¶210

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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Part A of Schedule 6 hereof and to be listed on The Bombay Stock Exchange; provided however that to the extent (1) any NCDs are acquired by the Company at anytime including through exercise of any call option available with the Company such acquired debentures shall be immediately cancelled and (2) if with consent of the Investors, any Debentures are acquired by any of the Promoters ("Acquired Debentures"), then such debentures shall immediately on acquisition thereof be restructured and not be considered as NCDs but shall become part of Promoter Contribution, shall be entitled to monies only in accordance with the Waterfall and shall be subordinate obligations of the Company ranking subordinate to the Debentures and junior to all claims of the Debenture Holders;

¶213

ggg) "OCDs" shall mean the optionally convertible debentures of face value Rs. 1,00,000 (Rupees One lakh Only) each issued/to be issued by the Company having rights, privileges and other terms as specified in Part B of Schedule 6 hereof;

¶214

vvv) "Security Holders Agreement" shall mean an agreement dated on or about the date of this Agreement between the Investor, ASK OFFSHORE, ASK IM, ASK RESOF II, the Shareholder, the Guarantor, the Confirming Party and the Company, inter alia, regulating certain governance and operations matters in relation to the Company and/or the Project;

¶215

“2.2 Subscription

¶216

(a) At the Closing Date, the Investor shall, subject to the terms and conditions of this Agreement including fulfilment, on or before the Long Stop Date, of each of the Conditions Precedent hereof to the satisfaction of the Investor and/or waiver thereof, at the discretion of the Investor and whether at the request of the Company or the Promoters or otherwise, invest an amount equivalent to Rs. 40,00,00,000 (Rupees Forty crores) ("Investment Amount”) in the Company, and subscribe to 4,000 (Four thousand) NCDs at par.”

¶217

“2.3 The Company undertakes, and the Promoters agree to cause the Company, to issue to the Investor the relevant amount of NCDs as specified in clause 2.2 above, on the terms and

¶218

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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conditions specified in this Agreement and the other Debenture Documents on the Closing Date and the Company also undertakes, and the Promoters agree to cause the Company, to make payments of all the amounts due in relation to the NCDs timely to the holders thereof. The Company and the Promoters agree that each NCO shall be issued to the Investor at par/face value and without addition of any premium.”

¶221

“2.5 It is agreed by the Company and the Promoters that the obligation of the Investor to invest the Investment Amount towards subscription of NCDs is subject to fulfilment or waiver of applicable Conditions Precedent.”

¶222

14. In any event, neither the sums being claimed to be due constitute a ‘financial debt’ nor has any ‘default’ occurred within the meaning of the Code. As such, the present Application is wholly misconceived and a mere attempt to browbeat the Respondent into paying sums that are otherwise not due and payable.

¶223

15. It is submitted that the amounts alleged to be a ‘debt’ and ‘outstanding and payable’ by the Respondent to the Financial Creditors and allegedly defaulted by the Respondent is not a financial debt within the meaning of Section 5(8) of the Code, which position is also admitted by the alleged Financial Creditors. Consequently, the present application seeking initiation of insolvency proceedings is misconceived and devoid of any merits, and not maintainable. Relevant Clauses of Agreement are as follows:

¶224

“5. ASK REAL ESTATE SPECIAL OPPORTUNITIES FUND-II an alternative investment fund registered with Securities and Exchange Board of India bearing registration number IN/AIF2/14- 15/0115 in form of a trust established under the Indian Trusts Act, 1882 having its principal office at Mumbai and its trustees as ASK Trusteeship Services Private Limited, a company in terms of the Companies Act, 2013 and having its registered office at Birla Aurora, 16 Level, office floor 9, Dr. Annie Besant Road, Worli, Mumbai - 400030 (hereinafter

¶225

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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referred to as "ASK RESOF II", which expression shall, unless it be repugnant to the subject or context thereof, include each its successors and/or assigns, including in the event of any inspecie distribution of assets, the beneficiaries of such distribution and their successors and assigns);

¶228

“1. Definitions and Interpretation

¶229

1.1 Definition

¶230

aa) "Debentures" shall mean the Senior NCDs, NCDs and the OCDs collectively and Debenture shall mean any one of them as the context may require;

¶231

z) "Debenture Document(s)" means this Agreement, the Existing Subscription Agreements, the Security Holders Agreement, the Security Documents, including the Debenture Trust Deed, and such other deeds and documents as are required for the purposes of recording the investment of, and the rights and privileges of, the Debenture Holders in and against the Company and the Promoters;

¶232

kk) "Existing Debentures" means the NCDs and the OCDs;

¶233

uu) "Investor Securities" shall mean the aggregate of the 638 (Six hundred and Thirty Eight) Senior NCDs subscribed in terms of this Agreement by ASK RESOF II, 208 (Two hundred and Eight) Senior NCDs subscribed in terms of this Agreement by ASK OFFSHORE and the 4 (Four) Senior NCDs subscribed in the terms of this Agreement by ASK IM collectively, and Investor Security shall mean any one of them as the context may require;

¶234

iii) "NCDs" shall mean the non-convertible debentures of face value Rs. 1,00,000 (Rupees One lakh Only) each issued/to be issued by the Company having rights, privileges and other terms as specified in the Debenture Documents, including in Part A of Schedule 6 hereof and to be listed on The Bombay Stock Exchange; provided however that to the extent (1) any NCDs are acquired by the Company at anytime including through exercise of any call option available with the Company such acquired debentures shall be immediately cancelled and (2) if with consent of the Investors, any Debentures are acquired by any of the Promoters ("Acquired Debentures"), then such debentures shall immediately on acquisition thereof be

¶235

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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restructured and not be considered as NCDs but shall become part of Promoter Contribution, shall be entitled to monies only in accordance with the Waterfall and shall be subordinate obligations of the Company ranking subordinate to the Debentures and junior to all claims of the Debenture Holders;

¶238

kkk) "OCDs" shall mean the optionally convertible debentures of face value Rs. 1,00,000 (Rupees One lakh Only) each issued/to be issued by the Company having rights, privileges and other terms as specified in Part B of Schedule 6 hereof;

¶239

xxx) “Security Documents" means the personal guarantee(s) of the Guarantor, the Debenture Trust Deed, the various deeds and documents, if any, required to create and perfect a mortgage over the Property and a charge over all receiva bles I movables of the Project, in each case for the benefit of any of the Debenture Holders and in each case as required in accordance with this Agreement or the other Debenture Documents;

¶240

yyy) "Security Holders Agreement" shall mean an agreement dated on or about the date of this Agreement between the Investors, ASK RESO F, the Shareholder, the Guarantor, the Confirming Party and the Company, inter alia, regulating certain governance and operations matters in relation to the Company and/or the Project;

¶241

aaaa) "Senior NCDs" or "Senior Debentures" shall mean the non-convertible debentures of face value Rs. 10,00,000 (Rupees Ten lakh Only) each issued/to be issued by the Company having rights, privileges and other terms as specified in the Debenture Documents, including in Part C of Schedule 6 hereof and to be listed on The Bombay Stock Exchange; provided however that to the extent (1) any Senior NCDs are acquired by the Company at anytime including through exercise of any call option available with the Company such acquired debentures shall be immediately cancelled and (2) if with consent of the Investors, any Debentures are acquired by any of the Promoters {"Acquired Senior Debentures"), then such debentures shall immediately on acquisition thereof be restructured and not be considered as Senior NCDs but sha ll become part of Promoter Contribution, shall be entitled to monies only in accordance with

¶242

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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the Waterfall and shall be subordinate obligations of the Company ranking subordinate to the Debentures and junior to all cla ims of the Debenture Holders;

¶245

2.3. The Company undertakes, and the Promoters agree to cause the Company, to issue to the Investors the relevant amount of Senior NCDs as specified in clause 2.2 above, on the terms and conditions specified in this Agreement and the other Debenture Documents on the Closing Date and the Company also undertakes, and the Promoters agree to cause the Company, to make payments of all the amounts due in relation to the Senior NCDs timely to the holders thereof. The Company and the Promoters agree that each Senior NCO shall be issued to the Investors at par/face value and without addition of any premium.

¶246

2.5 It is agreed by the Company and the Promoters that the obligation of the Investors to invest the respective portion of the Investment Amount towards subscription of respective Senior NCDs is subject to fulfilment or waiver of applicable Conditions Precedent.

¶247

2.6 The Parties agree that the terms of the Senior NCDs as specified in Part C of Schedule 6 shall be in addition to the other terms as specified in the Debenture Documents. Without prejudice to the generality of the aforesaid, the Parties agree that:

¶248

a) Each Senior NCO shall earn interest in the form of Coupon on a per annum basis payable on the principal amount of each Debenture and solely from the Remainder Amounts. It is clarified that the Coupon would only be payable to the extent of the Remainder Amounts available annually, but subject to clause 2.6(c) below, at the end of each Financial Year unless the Board determines an earlier payout from the Remainder Amounts; provided also that to the extent that there are insufficient Remainder Amounts at the end of any Financial Year, the excess Coupon would not accrue but would be accrued in the year in which there are Remainder Amounts and would be paid out of the Remainder Amounts;

¶249

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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b) Senior Redemption Premium and principal sums shall each be due and payable notwithstanding anything to the contrary contained in this Agreement on the Redemption Date for such Senior NCD;

¶252

c) Any payment of Coupon, Senior Redemption Premium or principal sums of the Senior Debentures shall on the relevant due date be paid to persons who are the holders of the Senior NCDs on the relevant Record Date and provided, to the extent required, consent of holders of Piramal Debentures or LIC HFL, as the case may be, is obtained for such payment or the Piramal Debentures and LIC Loans have been redeemed/repaid, as the case may be, on or before such date of payment;

¶253

d) If any payment was due on a day which was not a Business Day, then the immediately preceding Business Day would be considered as the due date for the purposes of payment but all interest, premium etc would be calculated till the actual due date;

¶254

e) The principal amount of the Senior NCDs, the Coupon and the Senior Redemption Premium would be secured by the following:

¶255

1. Second ranking Charge in the nature of mortgage with the Debenture Trustee on the Land and all developments thereon;

¶256

2. Second ranking Charge over present and future receivables of the Company from the mortgaged properties; and

¶257

3. Personal Guarantee by the Guarantor

¶258

The aforesaid security in 1 and 2 would be created subject to the same being allowed by existing or proposed lenders of the Company or in case the existing · and proposed lenders of the Company are fully satisfied in which case the Company shall, and the Promoters shall cause the Company to, obtain all consents, including any permission to mortgage from NOIDA, for such security creation and shall also undertake all other actions and filings as is required or desirable for the creation and perfection of such security. The aforesaid security when created

¶259

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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shall rank pari passu for the benefit of all the Senior NCDs, the NCDs and the OCDs.

¶262

“3. CONDITIONS PRECEDENT

¶263

3.1 The obligations of the Investors under this Agreement and the other Debenture Documents including its obligation to subscribe to any Debenture and make payment of any part of the Investment Amount shall be conditional upon the issuance of the CP Fulfillment Certificate by the Company and the fulfillment (or, where permissible under applicable Law, waiver by the Investors, in their sole discretion) of the following conditions precedent, in each case, to the satisfaction of the Investors, who shall be entitled to act in their sole discretion ( "Conditions Precedent" ):

¶264

1. Evidence of receipt of requisite approvals from, the Board and shareholders of the Company and the Promoters (to the extent required) to execute this Agreement and the other Debenture Documents and to undertake and perform the transactions and other obligations contemplated under this Agreement and the Debenture Documents;

¶265

2. The Investors should have concluded appropriate due diligence, including legal and tax, on the Lands, the Company and the Project and any concerns arising therefrom should have been settled to the satisfaction of each Investor;

¶266

3. The Company and all other persons parties to the various Project Documents (other than any builder buyer agreements) should not have been in material breach of any of the terms thereof save and except as disclosed to the Investors prior to the date hereof;

¶267

4. Except for Piramal Finance Limited, its debenture trustee, the Existing Debenture Holders and the Debenture Trustee, no Person should have claimed any Encumbrance and no Person should have encroached upon the Land or the Project or any development thereon or any receivables or claims arising thereon;

¶268

5. The Company, the Promoters and the Investors should have agreed to the business plan attached as Schedule 7

¶269

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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(the "Business Plan") for the Project, indicating cash flow, development milestones, key expenditure items, schedule for making payments, etc. and this Business Plan should have been adopted by the Board and a certified true copy of the resolution regarding such adoption should be provided to the Investors and to ASK RESOF;

¶272

6. The Company should have obtained a signed certificate, in a form approved by the Investors, from a registered independent chartered accountant acceptable to the Investors confirming that the issuance of the Senior Debentures does not breach any borrowing limits binding on the Company;

¶273

7. The proposed Senior Debenture Holders should have obtained the benefit of the Debenture Trust Deed;

¶274

8. The Guarantor should have issued a personal guarantee (in a form acceptable to the Investors) guaranteeing the obligations of the Company upon the occurrence of an Event of Default;

¶275

9. The Company should have issued to and delivered to the Investors cheques dated as of the Redemption Date ("PDCs") for the principal sums of the respective portion of the Investment Amount, the Coupon and the Senior Redemption Premium till the Redemption Date for the Senior Debentures, duly signed and executed by Mr. Getamber Anand as a signatory of the said bank account;

¶276

10. The Guarantor should have confirmed that all approvals required for the Campa ny to bind it to the transactions contemplated under this Agreement and the Debenture Documents have been legally and validly obtained;

¶277

11. No Material Adverse Effect should have been continuing or be threatened;

¶278

12. The Company should have delivered a valuation certificate from a chartered accountant for the Lands, including development rights therein and any receivables arising therefrom which have not become overdue by more than 180 (one hundred and eighty) days, valuing it at no lower than the total value f the aggregate of the Investment Amount and the amounts invested in terms of the Existing Subscription Agreements;

¶279

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶280

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20. Each of the Existing Debenture Holders and the Debenture Trustee shall have agreed to the issuance of the Senior NCDs, the ext ension, when created, of pari passu security for the benefit of the Senior Debenture Holders, the modifications of the terms of the NCDs and the OCDs and the modification of the terms of the Debenture Documents; and

¶282

21. The Company should have delivered to the Investors a non-objection certificate on behalf of holders I trustee of Pi ramal Debentures.

¶283

“3.2 The Company and the Promoters shall use best efforts to ensure the expeditious fulfillment of each of the Conditions Precedent. The Company shall issue a CP Fulfilment Certificate to the Investors immediately upon satisfaction of all the Cond itions Precedent along with evidence of satisfaction of each Condition Precedent unless the fulfilment thereof has been waived by the Investors. If the Company or the Promoters are seeking a waiver of any of the Conditions Precedent, then the Company shall issue a waiver request to the Investors requesting it to waive such Condition Precedent. The waiver request shall be in writing, signed by a director of the Company and shall explain in reasonable detail the reason why the particular Condition Precedent could not be met. The waiver request shall also describe the steps which the Company is taking and/or proposing to take to satisfy the particular Condition Precedent. If upon receipt of the CP Fulfilment Certificate, the Investors are of the opinion that any condition has not been fulfilled, they or any of them shall issue a notice to the Company informing it of the condition which has not been fulfilled and thereafter the Company and the Promoters shall make all efforts to fulfil the relevant condition as soon as reasonably possible thereafter and in any case on or before the Long Stop Date, failing which the Investors shall be under no obligation to invest. Each CP Fulfilment Certificate shall contain the amounts sought from the Investors and which shall, in respect of each Investor not be higher than ASK RESOF II Investment Amount, ASK OFFSHORE Investment Amount or the ASK IM Investment Amount (as applicable), and in aggregate not be higher than the Investment Amount.”

¶284

X X X

¶285

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶286

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¶287

18. It is further submitted neither any alleged debts nor any alleged defaults exist which are necessary ingredients to be satisfied before preferring the present application. Evidently, the present application is an abuse of process of law to arm twist the Respondent to succumb to its demands. Moreover, contrary to the Applicants assertions, the Respondent has not breached or defaulted on any of the terms of the Agreements. The Respondent denies all your assertions as set out in the Application unless expressly admitted herein.

¶288

19. In any event, no amounts are due in view of the Covid-19 pandemic which constitutes a force majeure event as recognized by the Delhi High Court even when expressively not mentioned within the Agreements. It is submitted that the Debenture Trust Deed/Investment Agreement are in nature of a commercial agreement and therefore, as per relevant trade usages and even otherwise, the terms/clauses of force majeure are automatically incorporated in these Agreements. In any event, in such contracts, the clauses of force majeure are clearly implied and not expressly provided for. Owing to the subsistence of these force majeure events, the timelines under the Agreements for making the said allegedly payments therefore stand suspended/extended w.e.f. from March 2020 and in any event continues till date. As such, it cannot be stated that the Company has committed any default or owes any debt to the Financial Creditor at present in view of the fact that any and all timelines stand extended in view of the force majeure provisions.

¶289

20. Furthermore, the amounts towards interest being sought by you under the Investment Agreements are clearly oppressive, exorbitant and usurious and as such cannot be sought for, especially during the present times when the Company’s entire real estate business

¶290

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶291

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¶292

has been adversely impacted owing to the Covid-19 pandemic situation.

¶293

AMOUNTS ALLEGED TO BE IN DEFAULT ARE INFLATED AND EXAGERRATED

¶294

21. In any event and without prejudice to the aforesaid submissions, it is specifically denied that any amount was due on 31.05.2023 and that the payment on which has been defaulted by the Respondent. Furthermore, as also detailed herein, it is clear that the sum of INR 261,27,92,247 (Rupees Two Hundred and Sixty-One Crores Twenty-Seven Lakhs Ninety-Two Thousand Two Hundred and Forty-Seven only) (amount in default as on 31.05.2023) that has been alleged to be due or in default in the instant proceedings are in any event illegal, exaggerated and hence cannot be said to be the due amounts. It is therefore clear that to date there has been no valid demand made by the Financial Creditors/ASK Entities against the Respondent. In any event, as is clear from the below facts, no such demand can be made against the Respondent at this stage. The amounts being asserted by the Financial Creditors/ASK Entities in the present proceedings are inflated and exaggerated, hence, neither due nor payable.

¶295

22. The Financial Creditors/ASK Entities have failed to furnish any document on record that entitles them to claim a sum of INR 261,27,92,247/-from the Respondent. They have also failed to share the break-up or methodology for arriving at this outstanding figure as claimed by them.

¶296

THE RESPONDENT HAS NOT COMMITTED ANY DEFAULTS WITH RRESPECT TO THE FORCE MAJEURE EVENTS I.E., THE COVID19 PANDEMIC

¶297

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶298

Page 44 of 72

¶299

23. It is submitted that the Security Subscription Agreement/ Investment Agreement is a commercial agreement and therefore, as per relevant trade usages and even otherwise, the terms/clauses of force majeure are automatically incorporated in these Agreements. In any event, in such contracts, the clauses of force majeure are clearly implied and not expressly provided for.

¶300

24. It is submitted that time was not of the essence in any of the agreements between the Parties. Moreover, the Parties had always considered that the alleged time/alleged stipulated dates under the Agreement could not be set in stone and were extendable.

¶301

25. Keeping the aforesaid factors in mind, in terms of the admitted force majeure events and the impossibility of performance at this stage, the time for performance under the Agreement correspondingly stands extended during the continuation of the said force majeure events.

¶302

26. In any event, under Section 56 of the Indian Contract Act, 1872 and even otherwise, the time for performance stands extended and/ or the obligations stand frustrated owing to the impossibility to perform the Agreement.

¶303

27. It is submitted that owing to the Covid-19 pandemic, lockdowns, bans etc., there was no way for the Respondent to continue with the construction of the project i.e., ATS Knightsbridge in order to redeem the OCDs on time. As such, in any event, the time stands extended owing to the impossibility of performance under the Agreement and the consequent frustration of the said Agreement.

¶304

28. In this regard, it is submitted that the ongoing Covid-19 crisis is an extraordinary and unprecedented crisis and is beyond the control of the parties. The crisis has been aggravated manifolds due to the curtailed economic activity and the already existing financial vulnerabilities in the economy. It is predicted that the present crisis

¶305

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶306

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¶307

will push the economy into a recession worse than the 2008 financial crisis. As such, the country is facing its greatest challenge in recent times.

¶308

29. It is submitted that the governmental authorities had imposed drastic restrictions on the businesses functioning across the country. These restrictions imposed by the government authorities led to our economic activities virtually being brought to a halt, liquidity shortages and other disruptions in our business. The impact of the pandemic is uniquely challenging as due to the mobility constraints there was a serious and profound impact on all businesses in the country, including the real estate sector.

¶309

30. In recognition of the unprecedented impact of the pandemic, the Government of India issued an order no. F18/4/2020-PPD dated 19 February 2020 and clarified in February 2020 itself that the disruption of supply chains due to outbreak of the Covid-19 pandemic would constitute a force majeure event. As such, even the Government of India is commercially treating the outbreak as an extraordinary event akin to a force majeure event and exempting the parties from complying with the contractual and other obligations.

¶310

31. Thereafter, on 11 March 2020, the World Health Organization declared that the Covid-19 outbreak is characterized as a pandemic. This was followed by the Government of National Capital Territory of Delhi invoking provisions of the Epidemic Diseases Act 1897 on 12 March 2020 which signified the existence of a public health emergency in NCT of Delhi. Owing to the foregoing, our business activity, which had been crippled because of the onset of the pandemic, completely collapsed from March 2020 onwards.

¶311

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶312

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¶313

32. Subsequently, even the Government of India announced its decision under notification (No. 33-4/2020/NDM-I) dated 14 March 2020 to treat COVID-19 as a "notified disaster". As such, all governmental authorities recognized that the Covid-19 was an unprecedented disaster.

¶314

33. Thereafter, the Government of Uttar Pradesh, Delhi Government etc. imposed severe lockdown restrictions owing to which movement of persons / collection of people could not take place and normal business activity could not be carried out.

¶315

34. In parallel to this, the Government of India imposed a Janata curfew on 22.03.2020 and a nationwide lockdown on 24.03.2020 (which was thereafter extended on multiple occasions and in fact continues to be in force in many nearby regions). As a result of this, the entire Country was put under a lockdown and only essential services such as hospitals, ration shops etc. were allowed to operate.

¶316

35. Considering that the Respondent's operations were non-essential services as per the said order and subsequent notifications/orders issued by various governments, it became illegal for it to even open its offices, let alone carry out its business activities. Therefore, as a result of these restrictions, the Respondent's construction business operations came to a complete standstill. It is submitted that this is an unprecedented situation and has affected all business operations in the country.

¶317

36. In view of the pandemic, the governmental authorities have taken several drastic steps including the postponement of all financial, disclosure and other compliance related obligations and the Courts have granted urgent reliefs to the parties. For instance, the Reserve Bank of India has introduced several relief measures such as imposing a moratorium/deferment of 3 months on payment of loan

¶318

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶319

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instalments and interest on working capital facilities, and exemptions from several compliance and disclosure requirements. As such, the present crisis is so unprecedented that the banks are also being directed to not take any coercive action for financial defaults and in fact are not even declaring accounts as NPAs despite the defaults.

¶321

37. The Reserve Bank of India has also recognized the liquidity stress in the economy and introduced various policies vide Statement on Developmental and Regulatory Policies dated 27 March 2020. The Statement recognizes that due to lockdown nearly all of the businesses have come to a standstill which is leading inter alia to a sudden liquidity stress in the markets. It also emphasizes the need for "easing financial stress caused by COVID-19 disruptions by relaxing repayment pressures and improving access to working capital".

¶322

38. Similarly, the Securities and Exchange Board of India ('SEBI) has issued various circulars exempting various entities from its compliance and disclosure requirements, listing obligations etc. As such, even SEBI has recognized that the businesses are unable to function and carry out even their day-to-day affairs due to prevailing mobility restrictions and other logistical challenges.

¶323

39. Moreover, the Ministry of Road Transport and Highways, the Government of India has also introduced several relief measures for its sub-contractors vide its Office Memorandum No. COVID19/RoadMap/JS(H)/2020 dated 18 May 2020. These relief measures include measures such as allowing extension of time to contractors under respective force majeure provisions, waiver of penalty for delay in submission of Bank Guarantees etc. The scale of these reforms shows the negative impact of the pandemic on the businesses in the country.

¶324

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶325

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¶326

40. Apart from the regulators, even the courts in the country have taken cognizance of the disruptions caused by the Covid-19 crisis and extended limitation/interim orders irrespective of the conditions prescribed therein (if any). For instance, the Hon'ble Supreme Court of India vide Orders dated 23 March 2020 and 6 May 2020 extended the period of limitation in respect of all matters w.e.f. 15 March 2020 in Suo Motu Writ Petition No. 3/2020. The said Orders were passed in recognition of the impact of the pandemic.

¶327

41. Similarly, the Hon’ble Delhi High Court directed vide an administrative order bearing No. 373/Est/E1/DHC dated 23 March 2020 that the limitation period in all pending cases shall not run during the lockdown period. Subsequently, it also extended all interim orders in pending matters w.e.f. 16 March 2020 vide its order dated 25 March 2020 passed in Writ Petition Urgent 2/2020 till 15 May 2020 or further orders. Similar omnibus orders have been passed by nearly all other High Courts extending the interim orders which have expired or were about to expire after mid-March 2020. These omnibus orders demonstrate the scale of the crisis the businesses are currently experiencing in the country.

¶328

42. It is submitted that the Hon'ble Supreme Court passed an order dated 08.03.2021 in Suo Moto Writ Petition (Civil) No. 3 of 2020 extending the period of limitation prescribed under the general law of limitation or any other special law for any suit, appeal, application, or proceedings. The Hon'ble Court held that the period between 15.03.2020 till 14.03.2021 shall stand excluded.

¶329

43. In this regard, reference may also be made to the Hon'ble Delhi High Court's judgment in Halliburton Offshore Services v. Vedanta Ltd, O.M.P. (1) (COMM) 88/2020 (Judgment dated 29 May 2020) that the ongoing COVID-19 pandemic constitutes a force majeure event. This was further reiterated in MEP Infrastructure

¶330

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶331

Page 49 of 72

¶332

Developers Ltd. v. South Delhi Municipal Corporation and Others, W.P. (C) 2241/2020 (Judgment dated 12.6.2020) wherein the Hon'ble High Court observed that the ongoing pandemic has substantially altered ground realities. Similarly, the Hon'ble High Court held the following: in Mumbai International Airport Limited v. Airports Authority of India and An. (ОМР()(Comm.) 174/2020):

¶333

"20. (….) The COVID-2019 pandemic was, undisputedly, an "epidemic or plague within India". The resultant restrictions, lockdowns and advisories issued by the Central and State Governments and Authorities also, in my view, qualify as an "event or circumstance of a nature analogous" to the events set forth in clauses (i) to (viii) of Article 16.1.3 and are also, therefore, "Force Majeure". Even if one were not to seek recourse to clause (x), the said restrictions, lockdowns and advisories undoubtedly constituted "consequences" of the COVID-2019 pandemic which, too, are specifically covered by Article 16.1.3.

¶334

23. The COVID-2019 pandemic, and its sequelae in the form of the various restrictions imposed by the Governmental authorities, on which MIAL relies, were clearly beyond the reasonable control of MIAL. It cannot be said that MIAL could, with the exercise of good industry practice or reasonable skill and care, have avoided either the COVID2019 pandemic, or the imposition of the restrictions and lockdown that followed thereupon. Nor could it be said that the COVID-2019 pandemic, or the resulting restrictions and lockdowns, resulted from any negligence or misconduct of MIAL, or the failure of MIAL to perform its obligations under the OMDA. Conditions (b), (c) and (d) of "force majeure", as set out in Article 16. 1.2 of the OMDA, therefore, stand satisfied in the present case."

¶335

44. Furthermore, the Parliament has recently passed the Insolvency and Bankruptcy Code (Second Amendment) Act, 2020 vide which it has amended the Insolvency and Bankruptcy Code 2016 to provide permanent immunity to corporate debtors from initiation of any

¶336

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶337

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¶338

insolvency process for any default occurring in the period of six months or such further period as may be notified but not exceeding one year from 25 March 2020. In fact, the Amendment Act stipulates that no application shall ever be filed for initiation of corporate insolvency resolution process of a corporate debtor for the said default occurring during the said period.

¶339

45. It is submitted that these extreme steps evidence the crisis the country was undergoing and showed how severe the impact on the businesses has been. The intent of these reforms was to ensure that the businesses have sufficient liquidity, and they are able to re-start their activities and start generating revenues. These force majeure conditions have been recognized by all authorities and have persisted longer than anticipated by anyone. Therefore, it is undisputed that the Respondent could not have taken any steps in furtherance of its contractual obligations under the Agreement.

¶340

46. It is submitted that the unforeseen impact of this pandemic is therefore required to be taken into consideration under the Agreement and the corresponding period is required to be excluded in its entirety while calculating the time period available to the Respondent.

¶341

47. It is submitted that the onset of the pandemic had rendered the performance of the contractual obligations frustrated and impossible and as such no default can be attributed to the Respondent. The Covid-19 pandemic, which was evidently beyond what was contemplated by the Parties at the time of entering into the said obligations and is beyond the control of the Parties, has made the performance of the contractual obligations by the Respondent impossible and thus frustrated.

¶342

48. Therefore, the timelines under the Agreement (and or the other agreements - even if they apply qua the Respondent's obligations)

¶343

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶344

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¶345

for allegedly making the said payments stands suspended/extended owing to the onset of the Covid-19 pandemic. As such, it cannot be said that the alleged repayment 22 dates as specified in the previous agreements could not be extended particularly when the same fell in the midst of the lockdowns and the pandemic.

¶346

PRESENT INSOLVENCY PROCEEDINGS NOT MAINTAINABLE AND BARRED UNDER SECTION 10A OF THE CODE SINCE ALLEGED DEFAULT OCCURRED DURING SUSPENDED PERIOD

¶347

49. It is submitted that Parliament has passed the Insolvency and Bankruptcy Code (Second Amendment) Act, 2020 vide which it has amended the Insolvency and Bankruptcy Code 2016 to provide permanent immunity to corporate debtors from initiation of any insolvency process for any default occurring in the period of six months or such further period as may be notified but not exceeding one year from 25 March 2020. Infact, the Amendment Act stipulates that no application shall ever be filed for initiation of corporate insolvency resolution process of a corporate debtor for the said default occurring during the said period.

¶348

50. It is submitted that even if we assume that the redemption of the outstanding debentures (OCDs & NCDs) were to be made on 07.06.2023 which was later on revised to 30.06.2023 and the nonredemption of the same by Respondent resulted in an event of default which further resulted into filing the present proceedings, even then the present proceedings are barred in view of the protection provided to the Corporate Debtor under Section 10 A of the Code. Considering the Covid-19 Pandemic a force majeure event, all such payments stand suspended/extended.

¶349

51. It is submitted that since the alleged defaults alleged to have been committed by the Respondent have occurred during the suspended

¶350

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶351

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period as defined under Section 10A of the Code hence, the present proceedings preferred by the alleged Financial Creditor against the Respondent is not maintainable and barred under law. It is submitted that Section 10A of the Code prohibits filing of an application for initiation of insolvency proceedings for any default arising after 25.03.2020, till the end of the Specified Period without an inquiry into the cause of default. In the present case since the default has occurred after 25.03.2020 and before the end of the specified period, the present application is barred by the force of Section 10A and deserved to be rejected outrightly by this Hon’ble Tribunal.

¶353

52. It is submitted that even if this Hon’ble Tribunal arrives at a finding that a debt exists whose default has been committed by the Respondent even in such a scenario the present proceedings are not maintainable being barred under the provision of Section 10A of the Code owing to the onset of the Covid-19 Pandemic and its after effect.

¶354

53. In light of the aforesaid, it is submitted that the present Application/Petition is misconceived and ought not to be allowed to be used as a pressure tactic to extort money from the Respondent. Accordingly, the present Application ought to be rejected.

¶355

APPLICANTS DELIBERETLY WITHHELD THE FUNDINGS

¶356

54. It is stated that the alleged Financial Creditors/ ASK Entities are joint signatories of the Respondent’s current Account nos. 7811474358 and 9613740402 maintained with Kotak Mahindra Bank with the primary motive that the Applicants were keen to oversee the deployment of funds received by the Respondent from the Applicants pursuant to the issuance of the above-stated securities. It was also a common understanding between the parties that the release of funds from the said current accounts

¶357

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶358

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¶359

would not be unreasonably withheld by Applicants/ASK entities as the funds were needed to carry out the construction and development activities.

¶360

55. Further, on many occasions and for prolonged stretches of time, the alleged Financial Creditors/ ASK Entities did not release any funds at all for operating and construction expenses in blatant dis-regard of the Project’s need and committed possession timelines to the customers and various other stakeholders. Inspite of the Respondent’s continuous follow-ups with the alleged Financial Creditors/ ASK Entities, their disbursement requests fell on deaf ears and money was not released to meet project expenses. Additionally, the Applicants, despite the repeated requests of the Respondent, did not sign the claques qua the development of the project leading to the further delay in completion of the Project.

¶361

56. It is pertinent to mention that the Applicants/ASK Entities turned blind eye to the Respondent’s request to release the funds lying in Current Account no. 7811474358 to pay the outstanding wages, salaries, statutory dues, construction and operating expenses of the Project, but to the Respondent’s dismay, no cooperation in this regard had been provided to the Respondent by the Applicants/ASK Entities.

¶362

57. Moreover, an unfortunate event that occurred at the project site was brought to the notice of the alleged Financial Creditor wherein, the they were appraised about the incident which took place on 26.06,2023, a site worker, namely Avnish Kumar Singh (Pump Operator) Employee ID MR03987 poured petrol over himself and attempted to immolate himself and commit suicide. Fortunately, nearby workers and security guards saw him doing so and snatched the lighter and match box before, in the nick of time or a grave tragedy could have occurred. The salary of this employee is

¶363

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶364

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¶365

Rs 17,000/- per month which was pending since March 2023. The said incident provoked other staff working at the project site, and they started threatening to take legal action against the company. The said event has been even reported to the concerned police station.

¶366

58. On 18.05.2022 the account balance of the joint account in which the alleged Financial Creditors are Joint signatory was INR 6,67,46,988/- The Respondent was desperately following up with the Applicants for release of funds to meet Project expenses.

¶367

59. However, to the utter shock and dis-may of the Respondents, the alleged Financial Creditor/ ASK Trusteeship Services Pvt. Ltd, in gross abuse of their power did not release even a Rupee to the Respondent for months, causing irreparable and irreversible harm to the Project’s progress. Further, they did not even release money to pay monthly GST, which is a statutory due. Finally, after much hue and cry the monies were released after 64 days by the alleged Financial Creditors without giving any reasons for the delay in the disbursal. This incident led to the resignation of almost 18 staff members working on the project site, since they could not receive their monthly Wages due to inaction of the alleged Financial Creditor in releasing of funds.

¶368

60. All this time, the Respondent was continuously requesting the alleged Financial Creditors to release the money lying in the accounts for project construction, as works at site were stalled causing utter distress to the Respondent and delay in completion of the project. Despite, repeated request of the Respondent to the alleged Financial Creditors to release the payments from the balance of INR 7,19,83,471/- which was lying in Current Account no. 7811474358 the alleged Financial Creditors paid no heed

¶369

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

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purposely leaving the Respondent helpless and distressed and causing unrest at the site amongst the workers as well.

¶372

61. From the above-stated facts and calculated misdemeanor of the alleged Financial Creditors/ ASK Entities, it is evident that these cold and calculated moves of the alleged Financial Creditors/ ASK Entities, were pre-meditated and filled with malafide intent to financially weaken the Respondent and make it vulnerable to legal action and to push it to insolvency. From the very beginning, the intent was to ensure that the Project doesn’t progress and in turn, the Respondent is left distraught, and its reputation is wrecked.

¶373

62. Pertinently, the Bank accounts have been in grip of the alleged Financial Creditors/ ASK Entities and non-release of funds by them resulted in slowing down Project construction. This in turn delayed the customer collections from existing sales due to non-achievement of milestones and hampered new sales. Since money was not flowing in and collections dwindled, the Respondent found it difficult to meet its loan obligations and the account was slipping towards being an NPA. Continuously, the circular flow of money was disrupted by the alleged Financial Creditors/ ASK Entities malafide and ill-intended actions, causing grievous injury to the project and the company.

¶374

63. The only logical conclusion based on this purposeful and continuing noncooperative and obstructive behavior of the alleged Financial Creditors/ ASK Entities is that the alleged Financial Creditor/ ASK Trusteeship Services Pvt. Ltd’s sole interest is to service its loan account and to bring the Respondent down on its knees. The alleged Financial Creditors/ ASK Entities entered into this financing arrangement with the Respondent with sole objective of earning interest at skyrocketing rates and it is neither interested in

¶375

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶376

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¶377

the well-being or progress of the Housing Project, nor in providing any financial assistance to the Respondent.”

¶378

As can be seen from the provisions of Section 7(3)(5) of IBC, 2016 and Regulation 2A of the IBBI (Resolution Process for Corporate Persons) Regulations 2016, for the purpose of admission or rejection of an application filed under Section 7 of IBC, 2016, this Tribunal may refer to the record of default recorded with the Information Utility or such other record of evidence of default as may be specified. The Regulation 2A of IBBI (Insolvency Resolution Process for Corporate Persons) Regulations 2016 reads thus:-

¶379

“ 2A. Record or evidence of default by financial creditor.— For the purposes of clause (a) of sub-section (3) of section 7 of the Code, the financial creditor may furnish any of the following record or evidence of default, namely:-

¶380

(a) certified copy of entries in the relevant account in the bankers’ book as defined in clause (3) of section 2 of the Bankers’ Books Evidence Act, 1891 (18 of 1891);

¶381

(b) an order of a court or tribunal that has adjudicated upon the nonpayment of a debt, where the period of appeal against such order has expired.”

¶382

In the present case, the default has been acknowledged in the Financial Statement of the CD. Besides, the Petitioners have also filed the record of default recorded with the Information Utility, though disputed by the CD.

¶383

The Section 7 does not provide that the dispute raised by the CD can be ground to nix the application filed under Section 7(2) of IBC, 2016. Thus, we need to go by the record of default registered with IU. Once, in the Financial

¶384

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶385

Page 57 of 72

¶386

Statement, the CD has acknowledged the default, we are unable to appreciate the plea raised on behalf of the CD that no notice of demand was sent by the Applicants. The Demand Notice is not the precondition for filing the application under Section 7(2) of IBC, 2016. The Corporate Debtor has not raised any plea regarding disciplinary action against the IRP proposed by the CD. Even otherwise also, the RP has given the declaration that no disciplinary proceedings are pending against him. The declaration reads thus:-

¶387

“Madam/Sir,

¶388

I, Gaurav Katiyar, an insolvency professional registered with Indian Institute of Insolvency Professionals of ICAI having registration number IBBI/IPA-001/IP-P00209/2017-18/10409 have been proposed as the interim resolution professional by the Financial Creditor, namely M/s. Ask Trusteeship Services Private Limited (through Ask Property Investment Advisors Private Limited), M/s. Ask India Real Estate Special Opportunities Fund Pte. Ltd. and M/s. Ask Investment Managers Limited, in connection with the proposed corporate insolvency resolution process of M/s ATS Heights Private Limited.

¶389

In accordance with rule 9 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016,1hereby:

¶390

i. Agree to accept appointment as the interim resolution professional if an order admitting the present application is passed;

¶391

ii. State that the registration number allotted to me by the Board is IBBI/IPA-001/IP-P00209/2017-18/10409 and that I am currently qualified to practice as an insolvency professional;

¶392

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶393

Page 58 of 72

¶394

iii. Disclose that I am currently having the following assignments in hand:

¶395

iv. Certify that there are no disciplinary proceedings pending against me with the Board or Indian Institute of Insolvency Professionals of ICAI;

¶396

v. Affirm that I am eligible to be appointed as a resolution professional in respect of the corporate debtor in accordance with

¶397

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶398

Page 59 of 72

¶399

the provisions of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016;

¶400

vi. Make the following disclosures in accordance with the code of conduct for insolvency professionals as set out in the Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016;

¶401

a. I hereby declare that I am eligible to be appointed as Interim Resolution Professional/ Resolution Professional/ in the case of the Corporate Debtor in view of the fact that I fall within the ambit of ‘Independent Person’ qua the Corporate Debtor as defined in explanation to Regulation 3 of The Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016.

¶402

b. I hereby declare that I do not have any pecuniary or personal relationship with the Corporate Debtor, as stipulated under Schedule-I of The Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016.

¶403

c. I hereby declare that I do not have any pecuniary or personal relationship with any of the stakeholders entitled to distribution under Section 53 or 178 of the code.

¶404

d. I shall maintain integrity by being honest, straightforward and forthright in all professional relationships.

¶405

e. I shall not misrepresent any facts or situations and should refrain from being involved in any action that would bring disrepute to the profession.

¶406

f. I shall act with objectivity in my professional dealings by ensuring that my decisions are made without the presence of any bias, conflict of interest, coercion, or undue influence of

¶407

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶408

Page 60 of 72

¶409

any party, whether directly connected to the insolvency proceedings or not.

¶410

g. I shall not acquire, directly or indirectly, any of the assets of the debtor, nor knowingly permit any relative to do so.

¶411

h. I shall maintain complete independence in my professional relationships and shall conduct the insolvency resolution, liquidation or bankruptcy process, as the case may be, independent of external influences.”

¶412

The application is also complete in all respects.

¶413

As far as the plea of financial health of the CD is concerned, the Respondent itself has admitted that it needs the financial aid, which the Petitioners denied. Further, in terms of the view taken by Hon’ble Supreme Court in subsequent judgment of Hon’ble Supreme Court in M. Suresh Kumar Reddy

¶414

vs. Canara Bank & Ors. (Civil Appeal No. 7121 of 2022), the view taken in Vidarbha Industries could be watered down. The relevant excerpt of the judgment reads thus:-

¶415

“ 9. The view taken in Innoventive Industries has been followed by this Court in the case of E.S. Krishnamurthy and others. Paragraph nos. 32 to 34 of the said decision read thus:

¶416

32. In Innoventive industries [Innoventive Industries Ltd. v. ICICI Bank, (2018) 1 SCC 407, paras 28 and 30 : (2018) 1 SCC (Civ) 356], a two-Judge Bench of this Court has explained the ambit of Section 7 IBC, and held that the adjudicating authority only has to determine whether a “default” has occurred i.e. whether the “debt” (which may still be disputed) was due and remained unpaid. If the adjudicating authority is of

¶417

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶418

Page 61 of 72

¶419

the opinion that a “default” has occurred, it has to admit the application unless it is incomplete. Speaking through Rohinton F. Nariman, J., the Court has observed : (SCC pp. 438-39, paras 28 & 30)

¶420

“28. When it comes to a financial creditor triggering the process, Section 7 becomes relevant. Under the Explanation to Section 7(1), a default is in respect of a financial debt owed to any financial creditor of the corporate debtor — it need not be a debt owed to the applicant financial creditor. Under Section 7(2), an application is to be made under sub-section (1) in such form and manner as is prescribed, which takes us to the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016. Under Rule 4, the application is made by a financial creditor in Form 1 accompanied by documents and records required therein. Form 1 is a detailed form in 5 parts, which requires particulars of the applicant in Part I, particulars of the corporate debtor in Part II, particulars of the proposed interim resolution professional in Part III, particulars of the financial debt in Part IV and documents, records and evidence of default in Part V. Under Rule 4(3), the applicant is to dispatch a copy of the application filed with the adjudicating authority by registered post or speed post to the registered office of the corporate debtor. The speed within which the adjudicating authority is to ascertain the existence of a default from the records of the information utility or on the basis of evidence furnished by the financial creditor, is important. This

¶421

it must do within 14 days of the receipt of the

¶422

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶423

Page 62 of 72

¶424

application. It is at the stage of Section 7(5), where the adjudicating authority is to be satisfied that a default has occurred, that the corporate debtor is entitled to point out that a default has not occurred in the sense that the “debt”, which may also include a disputed claim, is not due. A debt may not be due if it is not payable in law or in fact. The moment the adjudicating authority is satisfied that a default has occurred, the application must be admitted unless it is incomplete, in which case it may give notice to the applicant to rectify the defect within 7 days of receipt of a notice from the adjudicating authority. Under sub-section (7), the adjudicating authority shall then communicate the order passed to the financial creditor and corporate debtor within 7 days of admission or rejection of such application, as the case may be.

¶425

* * *

¶426

30. On the other hand, as we have seen, in the case of a corporate debtor who commits a default of a financial debt, the adjudicating authority has merely to see the records of the information utility or other evidence produced by the financial creditor to satisfy itself that a default has occurred. It is of no matter that the debt is disputed so long as the debt is “due” i.e. payable unless interdicted by some law or has not yet become due in the sense that it is payable at some future date. It is only when this is proved to the satisfaction of the adjudicating

¶427

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶428

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¶429

authority that the adjudicating authority may reject an application and not otherwise.’

¶430

33. In the present case, the adjudicating authority noted that it had listed the petition for admission on diverse dates and had adjourned it, inter alia, to allow the parties to explore the possibility of a settlement. Evidently, no settlement was arrived at by all the original petitioners who had instituted the proceedings. The adjudicating authority noticed that joint consent terms dated 12-2-2020 had been filed before it. But it is common ground that these consent terms did not cover all the original petitioners who were before the adjudicating authority. The adjudicating authority was apprised of the fact that the claims of 140 investors had been fully settled by the respondent. The respondent also noted that of the claims of the original petitioners who have moved the adjudicating authority, only 13 have been settled while, according to it “40 are in the process of settlement and 39 are pending settlements”. Eventually, the adjudicating authority did not entertain the petition on the ground that the procedure under IBC is summary, and it cannot manage or decide upon each and every claim of the individual homebuyers. The adjudicating authority also held that since the process of settlement was progressing “in all seriousness”, instead of examining all the individual claims, it would dispose of the petition by directing the respondent to settle all the remaining claims “seriously” within a definite time-frame. The petition was accordingly disposed of by directing the respondent to settle the remaining claims no later than within three months, and that if any of the remaining original petitioners were aggrieved by the settlement process, they would be at liberty to approach the adjudicating authority again in accordance

¶431

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶432

Page 64 of 72

¶433

with law. The adjudicating authority's decision was also upheld by the appellate authority, who supported its conclusions.

¶434

34. The adjudicating authority has clearly acted outside the terms of its jurisdiction under Section 7(5) IBC. The adjudicating authority is empowered only to verify whether a default has occurred or if a default has not occurred. Based upon its decision, the adjudicating authority must then either admit or reject an application, respectively. These are the only two courses of action which are open to the adjudicating authority in accordance with Section 7(5). The adjudicating authority cannot compel a party to the proceedings before it to settle a dispute.

¶435

(emphasis added)

¶436

10. Thus, once NCLT is satisfied that the default has occurred, there is hardly a discretion left with NCLT to refuse admission of the application under Section 7. “Default” is defined under sub-section (12) of Section 3 IBC which reads thus:

¶437

“ 3. Definitions: - In this Code, unless the context otherwise

¶438

requires—

¶439

.. .. .. .. .. .. .. ..

¶440

(12) “default” means non-payment of debt when whole or any part or instalment of the amount of debt has become due and payable and is not [paid] by the debtor or the corporate debtor, as the case may be;”

¶441

Thus, even the non-payment of a part of debt when it becomes due and payable will amount to default on the part of a corporate debtor. In such a case, an order of admission under Section 7 IBC must follow. If NCLT finds that there is a debt, but it has not become due and payable, the

¶442

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶443

Page 65 of 72

¶444

application under Section 7 can be rejected. Otherwise, there is no ground available to reject the application.

¶445

11. Reliance is placed on the decision of this Court in Vidarbha Industries and in particular, what is held therein in paras 86 to 89 which reads thus:-

¶446

“86. Even though Section 7(5)(a) IBC may confer discretionary power on the adjudicating authority, such discretionary power cannot be exercised arbitrarily or capriciously. If the facts and circumstances warrant exercise of discretion in a particular manner, discretion would have to be exercised in that manner.

¶447

87. Ordinarily, the adjudicating authority (NCLT) would have to exercise its discretion to admit an application under Section 7 IBC and initiate CIRP on satisfaction of the existence of a financial debt and default on the part of the corporate debtor in payment of the debt, unless there are good reasons not to admit the petition.

¶448

88. The adjudicating authority (NCLT) has to consider the grounds made out by the corporate debtor against admission, on its own merits. For example, when admission is opposed on the ground of existence of an award or a decree in favour of the corporate debtor, and the awarded/decretal amount exceeds the amount of the debt, the adjudicating authority would have to exercise its discretion under Section 7(5)(a) IBC to keep the admission of the application of the financial creditor in abeyance, unless there is good reason not to do so. The adjudicating authority may, for example, admit the application of the financial creditor, notwithstanding any

¶449

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶450

Page 66 of 72

¶451

award or decree, if the award/decretal amount is incapable of realisation. The example is only illustrative.

¶452

89. In this case, the adjudicating authority (NCLT) has simply brushed aside the case of the appellant that an amount of Rs 1730 crores was realisable by the appellant in terms of the order passed by APTEL in favour of the appellant, with the cursory observation that disputes if any between the appellant and the recipient of electricity or between the appellant and the Electricity Regulatory Commission were inconsequential.”

¶453

(emphasis added)

¶454

12. A review petition was filed by Axis Bank Ltd. seeking a review of the decision of Vidarbha Industries on the ground that the attention of the Court was not invited to the case of E.S. Krishnamurthy. While disposing of review petition by order dated 22^nd September 2022, this Court held thus:

¶455

“The elucidation in paragraph 90 and other paragraphs were made in the context of the case at hand. It is well settled that judgments and observations in judgments are not to be read as provisions of statute. Judicial utterances and/or pronouncements are in the setting of the facts of a particular case.

¶456

To interpret words and provisions of a statute, it may become necessary for the Judges to embark upon lengthy discussions. The words of Judges interpreting statutes are not to be interpreted as statutes.”

¶457

13. Thus, it was clarified by the order in review that the decision in Vidarbha Industries was in the setting of facts of the case before this Court. Hence, the decision in Vidarbha Industries cannot be read

¶458

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶459

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¶460

and understood as taking a view which is contrary to the view taken in the cases of Innoventive Industries and E.S. Krishnamurthy. The view taken in Innoventive Industries still holds good.”

¶461

In view of the aforementioned analysis and discussions, we are left with no option, but to admit the present application. Ordered accordingly. As has been ruled by Hon’ble Supreme Cour in the case of E S Krishnamurthy & Ors. vs. M/s Bharath Hi Tech Builders Pvt. Ltd. in (Civil Appeal No. 3325 of 2020) after arriving at the finding that the default has been committed, this Tribunal may strive that the matter is settled. The relevant excerpt of the judgment of Hon’ble Supreme Court reads thus:-

¶462

“28 Undoubtedly, settlements have to be encouraged because the ultimate purpose of the IBC is to facilitate the continuance and rehabilitation of a corporate debtor, as distinct from allowing it to go into liquidation. As the Statement of Objects and Reasons accompanying the introduction of the Bill indicates, the objective of the IBC is to facilitate insolvency resolution “in a time bound manner” for maximization of the value of assets, promotion of entrepreneurship, ensuring the availability of credit and balancing the interest of all stakeholders. What the Adjudicating Authority and Appellate Authority, however, have proceeded to do in the present case is to abdicate their jurisdiction to decide a petition under Section 7 by directing the respondent to settle the remaining claims within three months and leaving it open to the original petitioners, who are aggrieved by the settlement process, to move fresh proceedings in accordance with law. Such a course of action is not contemplated by the IBC.”

¶463

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶464

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¶465

Thus, we deem it pertinent to observe that in the interest of home buyers, the IRP would religiously discharge his duty under Section 20 of IBC, 2016, and would keep the CD as going concern. In order to ensure that the CD operates as going concern and its assets are managed properly, we appoint Hon’ble Mr. Justice Sunil Gaur (Mob. No. 997100718) as Monitor over the IRP to supervise the CIRP process. He would be assisted by Ms. Fiza Advocate (Mob. No. 9560603333) as Co-Monitor in the matter. The fee of the Monitor would be Rs. 6 lacs and that of Ms. Fiza Advocate would be 2.5 lacs till appointment of CoC. After appointment of CoC, it would be for CoC/AR qua the home buyers to take a decision regarding the Monitoring the affairs of the CD by Hon’ble Mr. Justice Sunil Gaur and Ms. Fiza Advocate. The fee of the ‘Monitor’ and ‘Co-Monitor’ would be initially paid by the Applicant in advance, and the same would be subsequently reimbursed to it as CIRP cost. If the CoC/AR decides the continuance of Monitoring of CIRP by Hon’ble Mr. Sunil Gaur, assisted by Adv. Fiza after appointment of CoC, their fee would be negotiated between them and CoC/AR, as the case may be. The IRP would report the progress regarding CIRP to Monitor on every alternate day. The Monitor is also requested to endeavour that the matter is resolved between the Petitioners before us and the Corporate Debtor and the project is completed to the benefit of the home buyers. For the purpose the Monitor may call the meeting of the Applicants, IRP and the Suspended Management. We also issue a specific direction that the suspended promoters/directors qua the CD and its management would extend all co-

¶466

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶467

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¶468

operation in terms of the provisions of Section 19(1) of the IBC, 2016, to RP and the Monitor.

¶469

In the wake, moratorium as provided under Section 14 of IBC, 2016

¶470

is declared qua the CD and as a necessary consequence thereof the following prohibitions are imposed, which must be followed by all and sundry :

¶471

(a) The institution of suits or continuation of pending suits or proceeding s against the Respondent including execution of any judgment, decree or order in any court of law, tribunal, arbitration panel or other authority;

¶472

(b) Transferring, encumbering, alienating or disposing of by the Respondent any of its assets or any legal right or beneficial interest therein;

¶473

(c) Any action to foreclose, recover or enforce any security interest created by the Respondent in respect of its property including any action under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002;

¶474

(d) The recovery of any property by an owner or lessor, where such property is occupied by or in the possession of the Respondent.

¶475

Accordingly, in the wake of prayer made in IA-1382(ND)2024, Mr. Gaurav Katiyar having Registration No: IBBI/IPA-001/IP-P00209/2017-18/10409

¶476

whose name is proposed by Applicant is appointed as IRP, subject to the condition that no disciplinary proceeding is pending against him and disclosures as required under IBBI Regulations, 2016 are made by him within a period of

¶477

one week from this Order. It is further ordered that Mr. Lekhraj Bajaj shall take

¶478

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶479

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¶480

charge of the CIRP of the Corporate Debtor with immediate effect and would take steps as mandated under the IBC specifically under Section 15, 17, 18, 20 and 21 of IBC, 2016 read with extend provisions of IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016.

¶481

The initial expenses of CIRP i.e. Rs. 2,50,000/- would be initially paid by Applicants, which would be subsequently adjusted as CIRP cost.

¶482

A copy of this Order shall immediately be communicated by the Registry/Court Officer of this Tribunal to the Petitioner /Financial Creditor, the Respondent/Corporate Debtor and the IRP mentioned above.

¶483

In addition, a copy of this Order shall also be forwarded by the Registry/Court Officer of this Tribunal to the IBBI for their records.

¶484

IA-1382/2024

¶485

For the reasons stated therein, the application is allowed and the name of newly proposed IRP Mr. Gaurav Katiyar having Registration No: IBBI/IPA-

¶486

001/IP-P00209/2017-18/10409 is taken on record as an IP proposed by the Petitioners to appointed as IRP.

¶487

IA-576/2024

¶488

In view of the aforementioned, the order passed in IB-570/ND/2023 the IA is disposed of.

¶489

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶490

Page 71 of 72

¶491

Inv. Petition-88/2023

¶492

The prayer made in the captioned petition is that the construction work should not be hampered and the home buyers should not be adversely affected. We have already passed an order in this regard in C.P (IB)-570/ND/2023. Nevertheless, it is further directed that the IRP would ensure that the project continue and construction work is not hampered. The Suspended Promoters/Management of CD would ensure full compliance of Section 19(1) of IBC, 2016.

¶493

Sd/Sd/(SUBRATA KUMAR DASH) (ASHOK KUMAR BHARDWAJ) MEMBER (T) MEMBER (J)

¶494

Inv. Pett.-88/ND/2023, I.A.- 576/ND/2024 and I.A.-1382/ND/2024 in (IB)-570/(ND)/2023 ASK Trusteeship Services Private Limited & Ors. vs. ATS Heights Private Limited

¶495

Page 72 of 72

In the matter of Ats Heights Private Limited [Inv. Pett.-88-2023, IA-576-2024 and IA-1382-2024 in Company Petition No. (IB)-570(ND)-2023]

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In the matter of Ats Heights Private Limited [Inv. Pett.-88-2023, IA-576-2024 and IA-1382-2024 in Company Petition No. (IB)-570(ND)-2023]

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