Union Bank of India vs Amit Katyal

LIST OF DATES & EVENTS

DATES	EVENTS
07/08/2014	Sanction letter reference no. CDS:CSI:SK:CAC:88:2014-15 the bank

sanctioned and granted term loan to the extent of Rs. 90,00,00,000/ (Rupees Ninety Crores only) was sanctioned. Copy of sanction letter dated 07/08/2014 is Appended as Annexure P1. Copy of Letter of acceptance dated 30.10.2014 is appended and marked as Annexure P 2

30.10.2014 & 28.10.2014 & 06.11.2014& 15.11.2014

Loan & Security documents duly executed were:- i) Escrow account agreement appended and marked as Annexure P 3 ii) Agreement for term loan dated 30.10.2014 appended and marked as Annexure P 4 iii) Common deed of hypothecation for movables dated 30.10.2014 is appended and marked as Annexure P 5 iv) Letter of undertaking/ Declaration from Defendant no 1 dated 30.10.2014 is appended and marked as Annexure P 6 v) Letter of consent for disclosure by Corporate Debtor dated 30.10.2014 is appended and marked as Annexure P

vi) Letter of consent for disclosure by Debtor dated 30.10.2014 is appended and marked as Annexure P 8. vii) Details of legal hier is appended and marked as Annexure P 9. viii) Board Resolution dated 10.10.2014 is appended and marked as Annexure P 10 ix) Letter of undertaking dated 10.10.2014 is appended and marked as Annexure P 11 x) Deed of guarantee in favor of the creditor dated 30.10.2014 is appended and marked as Annexure P 12. Primary security was created in respect of property being land and residential buildings to be constructed thereon (land) admeasuring 13.456 acre situated at sector-70, Gurgaon. Title documents deposited are as under:-a) Copy of memorandum of deposit of title deed is appended and marked as Annexure P 13. b) Letter confirming deposit of documents dated 28.10.2014 is appended and marked as Annexure P 14. c) Letter dated 06/11/2014 confirming the submission of documents is appended and marked as Annexure P 15. d) Undertaking declaration of Corporate Debtor is appended and marked as Annexure P 16. e) Letter requesting sub-registrar to note banks lien is appended and marked as Annexure P 17. Charge was also created in respect of assets being:-Charge & assignment of the all developmental rights consisting of entire planning, designing, development, construction, marketing, sales, transfer rights, sanction and permission. Hypothecation/Escrow of receivables of the project. Charge was registered with the Ministry of corporate affairs pursuant to section 77(1) and 78 of the companies act, 2013. Copy of registration of charge is appended and marked as Annexure P 18.

Part III

Through E-Mail, Speed Post and Courier

To,

date: 10.06.2021

Union Bank of India

M-93, Cannaught Circus,

New Delhi-110 001

E-mail: [email protected]

Subject: Reply to the Demand Notice dated 26.04.2021 received by our Client Mr. Amit Katyal on 28.05.2021.

Sir,

1.

We write to you, under the instruction of and on behalf of Mr. Amit Katyal, R/o: House No. C-654, New Friends Colony, New Delhi-110065 (herein after referred to as “our Client”), guarantor of Angle Infrastructure Pvt. Ltd., (herein after referred to as “the Company”) who have placed in our hands, the Notice referred to above (herein after referred to as “Demand Notice”) issued under Rule 7(1) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process of Personal Guarantors to Corporate Debtors) Rules, 2019 (hereinafter referred to as the “Insolvency Rules”) demanding / claiming an alleged sum of Rs.114.83 Crore (Rupees One Hundred Fourteen Crore and Eighty Three Lakhs only) as an alleged Debt purportedly due to Union Bank of India (hereinafter referred to as “Bank”).

2.

That at the outset, the contents of the Notice are specifically denied as false and misconceived and nothing contained in the demand Notice may be deemed to have been admitted, unless specifically admitted to herein below. Your Notice is untenable and you have no right to claim payments of the alleged sum of Rs.114.83 Crore (Rupees One Hundred Fourteen Crore and Eighty Three Lakhs only) from our Client under the Code or otherwise.

3.

That all the allegations and averments contained in your Notice under Reply, which are contrary to the response made hereinafter, and/or which have not been admitted hereinafter, may be considered to have been specifically denied and controverted.

That your Demand Notice is completely based on incorrect appreciation of facts, occasioned due concealment of material facts. In the circumstances, the contents of your Demand Notice are not only baseless and unfounded, but they are also completely devoid of any merit.

5.

That Angle Infrastructure Pvt. Ltd. is a company incorporated under the Companies Act, 1956 and existing under the Companies Act, 2013, having its registered office at 201, Elegance Tower, Plot No.8, District Centre Jasola, New Delhi-110025. The Company is developing a group housing project namely “Florence Estate” (hereinafter referred to as “the said Project”) at Sector 70, District: Gurugram, State: Haryana. Directorate of Town and Country Planning, Haryana, (hereinafter referred to as “DTCP”) issued a License bearing No. 170 of 2008 dated 22.09.2008 to M/s. Capital Builders (erstwhile owner of the land) for development of the said Project. M/s. Capital Builders subsequently transferred the license to the Company.

6.

That Corporation Bank sanctioned a term loan facility of Rs.90,00,00,000.00 (Rupees Ninety Crores only) to the Company vide letter dated 17.07.2014 to part finance the development of the said Project. Our Client is the guarantor of the said loan facility availed by the Company. An Agreement dated 30.10.2014 was executed between Corporation Bank and the Company. A Common Deed of Hypothecation of Moveables/Assets/Debts dated 30.10.2014 creating charge on all the development rights and receivables of the Project.

7.

That the Company is going through tough times and facing financial constrains due to the Pandemic of COVID-19 and various litigations against the Company.

8.

That as you are well aware that sometime in the year 2013, one Mr. Ballu Ram filed a Writ Petition (CWP No. 17737 of 2013) before the Hon’ble High Court of Punjab and Haryana challenging grant of license No. 170 of 2008 issued by DTCP. The Hon’ble High Court vide order directed the parties maintain status-quo with regard to transfer and construction in respect to the said Project. In view of the said order passed by the Hon’ble High Court of Punjab and Haryana, the Company failed to continue with any kind of construction at the project site. All the construction work at the project site came to stand still. The Hon’ble High Court of Punjab and Haryana vide order dated 17.11.2014 dismissed the said Writ Petition. In view of the said order dated 16.08.2013, the Company unable to do any kind of construction work at the project site for about fifteen (15) months.

9.

You are also well aware that in the matter of M/s. Capital Builders v/s. Angle Infrastructure Pvt. Ltd. EFA-15-2015 (O&M), the Hon'ble High Court of Punjab and Haryana vide order dated 10.09.2015 restrained the Company from creating any third party interest in respect to the unsold areas of the said Project. The Hon'ble High Court in only in the year 2019, vide order dated 08.05.2019 allowed the Company to sell the unsold areas in the said Project. In view of the circumstances beyond its control, the Company was unable to sell the unsold areas in the said Project and pay the due amounts to the bank within the stipulated period of time.

10.

That further as you are well aware that the Company had also applied with the DTCP for grant of permission for higher FAR to develop commercial component in the said Project. The sale value of the commercial area will be around Rs.80-90 Crores approx.

11.

That as you are also aware that the related group companies Krrish Shalimar Projects Pvt, Ltd. and Jasmine Buildmart Pvt. Ltd. have also availed various loan facilities from various banks and financial institutions and they have duly paid/ paying the due loan amounts to the banks and financial institutions.

12.

That due to the ongoing unprecedented crisis of Pandemic of COVID-19 and lockdown and restrictions laid by the Government and further due to unavailability of manpower since March, 2020, the Company failed to continue the development work at the Project site and the same has further delayed the whole project. The circumstances are still uncertain and unpredictable.

13.

The Company is in the process of completing and developing the said Project. The details of the status of the construction of the project as on 31.01.2021 are as under:

Work Description	Tower A	Tower B	Tower C	Tower D	Tower E

Floor Slabs	28th Floor + Terrace + Mumty Machine Room	27th Floor + Terrace + Mumty Machine Room	19th floor + Terrace + Mumty Machine Room	20th Floor	20th Floor
Brick/Block work	28th Floor + Terrace	27th Floor + Terrace + Mumty Machine Room	19th floor + Terrace + Mumty Machine Room	20th floor	19th floor
Door frame Fixing	28th floor	27th floor	19th floor	14th floor	14th floor
Electrical Conducting	28th floor	27th floor	19th floor	09th floor	09th floor
Plumbing	28th floor	27th floor	19th floor	06th floor	05th floor
Internal Plaster	27th floor	27th floor	19th floor	09th floor	09th floor
Fire Fighting	28th floor	27th floor	19th floor	---	---
Flooring	27th floor	27th floor	19th floor	---	---
PVC Doors / Windows	26th Floor	25th Floor	17th Floor	---	---
Fire NOC (will be Applied)	May-June 2021	May-June 2021	May-June 2021

Completion Date (Tentative)

31.12.2021

31.12.2021

31.12.2021

March 2023

March 2023

Further the Non Tower Area work has been completed 78%. Copies of the photographs of the project are attached for ready reference.

14.

That the Company will receive a sum of approx. Rs.158,26,81,027.00 (Rupees One Hundred Fifty Eight Crore Twenty Six Lakhs Eighty One Thousand and Twenty Seven only) from sold as well unsold areas of the said project. The Company will use these receivables to pay the due amounts to payable to the Bank. The details of the sold and unsold units and receivable in the said Project are as under:

“7.. It is most respectfully submitted that the Hon’ble Supreme Court of India in the matter of Mahendra Kumar Jajodia v/s. State Bank of India Stressed Asset Management Branch (Civil Appeal No. 1871-1872 of 2022) vide order dated 21.03.2022 stayed the order dated 27.01.2022 passed by the Hon’ble National Company Law Appellate Tribunal in Company Appeal (AT) Insolvency No. 60 of 2022 allowing an Appeal to proceed under Section 95(1) of the Code, in absence of a Corporate Insolvency Resolution Process of Liquidation Process against the Corporate Debtor..."

"10.

Sub-Section 1 of Section 60 provides that Adjudicating Authority in relation to Insolvency or Liquidation for Corporate Debtor including Corporate Guarantor or Personal Guarantor shall be the NCLT having territorial jurisdiction over the place where the Registered Office of the Corporate Person is located. The substantive provision for an Adjudicating Authority is Section 60, sub-Section (1), when a particular case is not covered under Section 60(2) the Application as referred to in sub-section (1) of Section 60 can be very well filed in the NCLT having territorial jurisdiction over the place where the Registered Office of corporate Person is located.

11.

The Adjudicating Authority erred in holding that since no CIRP or Liquidation Proceeding of the Corporate Debtor are pending the application under Section 95(1) filed by the Appellant is not maintainable. The Application having been filed under Section 95(1) and the Adjudicating Authority for application under Section 95(1) as referred in Section 60(1) being the NCLT, the Application filed by the Appellant was fully maintainable and could not have been rejected only on the ground that no CIRP or Liquidation Proceeding of the Corporate Debtor are pending before the NCLT. In result, we set aside the order dated 05th October, 2021 passed by the Adjudicating Authority. The Application filed by the Appellant under Section 95(1) of the Code is revived before the NCLT which may be proceeded in accordance with the law..."

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL No(s). 1871-1872 OF 2022

MAHENDRA KUMAR JAJODIA ETC.

Appellant(s)

VERSUS

STATE BANK OF INDIA, STRESSED ASSET MANAGEMENT BRANCH

Respondent(s)

O R D E R

We have heard learned Solicitor General and learned senior counsel for the parties and perused the record. We do not see any cogent reason to entertain the Appeals. The judgment impugned does not warrant any interference.

The Appeals are dismissed.

( S. ABDUL NAZEER )

( VIKRAM NATH )

NEW DELHI MAY 06, 2022