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“Legal Battle Unfolds: Roshanara Club Seeks Possession, Court Directs DDA to Devise Club Management Scheme”

Title: SH. MANISH AGGARWAL vs. THE ESTATE ORRICER & ORS

Citation: W.P.(C) 14739/2023

Coram: HON’BLE CHIEF JUSTICE & HON’BLE JUSTICE TUSHAR RAO GEDELA

Decided on: 9-11-23

Introduction:

In this case, the petitioner has approached the court seeking various reliefs. The petition challenges the constitutional validity of Section 3 of The Public Premises (Eviction of Unauthorized Occupants) Act, 1971. It also disputes the sealing and locking of Respondent No. 4 Club’s premises on September 29, 2023, based on an order from September 27, 2023, alleging it to be unconstitutional and violative of fundamental and statutory rights. Additionally, the petitioner seeks to declare the sealing as void ab initio, citing contravention of rule 7 of the mentioned Act. The petition further calls for the quashing of a Draft Policy to run the club, asserting that it goes against the statement made by the Additional Solicitor General in a previous order. The petitioner requests the court to grant any other necessary relief deemed fit in the circumstances of the case.

Facts:

The case involves Roshanara Club Limited (RCL), established in 1922, operating on land allotted under lease deeds by the Secretary of State for India and the Delhi Development Authority (DDA). The extended lease lapsed on December 31, 2017. RCL sought renewal, but after a series of communications, an eviction notice was issued on April 12, 2023. RCL filed a writ petition challenging the eviction notice with specific reliefs. The learned Single Judge, while noting the challenge to the eviction notice was not maintainable, issued an interim direction restraining coercive action against RCL solely based on the expired lease. The order allowed RCL to pursue statutory remedies against the eviction notice. The DDA appealed, and an order on June 2, 2023, directed the Principal District Judge to decide the appeal without being influenced by the High Court’s order. The case is scheduled for further proceedings on September 13, 2023.

Judgement analysis:

In the given case, the Division Bench of the Court did not grant relief to Roshanara Club. Instead, it directed the Delhi Development Authority (DDA) to devise a scheme for running the club and did not hand over possession to the ex-management of the club. Subsequently, a Special Leave to Appeal (SLP) was filed before the Hon’ble Supreme Court, seeking restoration of possession to Roshanara Club, but the relief was not granted.

Following these events, a new petition was filed by certain club members. However, the court, considering that it is already dealing with the issue of running the club and that a related writ petition is pending, decided not to grant interim relief in the present petition. The court noted that the DDA is in the process of finalizing a scheme for the smooth running of the club, and accordingly, rejected the prayer for interim relief. The case is scheduled for further proceedings along with LPA No. 497/2023 on December 7, 2023.

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Written By: Gauri Joshi

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“IBC Moratorium: Court Affirms Legality of Tax Proceedings During Resolution, Dismisses Petitioner’s Challenge”

Title: PLATINO CLASSIC MOTORS INDIA PVT.LTD vs. DEPUTY COMMISSIONER OF CENTRAL TAX AND EXCISE AND ORS.

Citation: WP(C) NO. 7997 OF 2023

Coram: JUSTICE DINESH KUMAR SINGH

Decided on: 20-10-23

Introduction:

In this writ petition, the petitioner, a dealer of BMW cars in Kerala, challenges the orders identified as Exhibits P-7, P-8, P-9, and P-10. The legal dispute arises from an application filed by the Federal Bank of India under Section 7(4) of the Insolvency and Bankruptcy Code, 2016 (IBC) for initiating the corporate insolvency resolution process against the petitioner. The National Company Law Tribunal, Cochin, admitted the application on March 8, 2021, as per Exhibit P-1. Following the admission, an Interim Resolution Professional (IRP) was appointed to manage the affairs of the petitioner. However, the resolution plans submitted by the applicants were rejected by the Committee of Creditors. Since no resolution plan was accepted, the Committee of Creditors decided to seek a directive from the National Company Law Tribunal, Cochin, for the liquidation of the petitioner’s company. The present writ petition challenges the orders related to these proceedings.

Facts:

In this case, an order of liquidation was issued on September 30, 2022, pursuant to Section 33 of the Insolvency and Bankruptcy Code (IBC) by the National Company Law Tribunal, Cochin. The Interim Resolution Professional (IRP) was appointed as the Liquidator, initiating a moratorium under Section 33(5) of the IBC. The petitioner’s Liquidator received claims from the first respondent, consisting of five items, in response to a public notice.

The petitioner contends that orders (Exhibits P-7 to P-10) forming the basis of the five claims were issued after the commencement of the moratorium on March 8, 2021, and argues that the petitioner was not given an opportunity to present and contest the case.

The respondent’s counsel argues that notice was indeed issued to the petitioner, a reply was filed, and the authorized representative was heard. The respondent disputes the claim that the petitioner was not heard during the issuance of orders in Exhibits P-7 to P-10. Additionally, the respondent contends that ongoing assessment proceedings and adjudication under Section 14 of the IBC are not barred. The assessment orders (Exhibits P-7 to P-10) were allegedly completed in compliance with statutory requirements, and the Official Liquidator’s absence during the finalization of the assessment should not invalidate these orders. The court considers these arguments in its evaluation of the case.

Judgement analysis:

The judgment in this case clarifies that Section 14 of the Insolvency and Bankruptcy Code (IBC) does not prohibit the finalization of assessment and adjudication proceedings related to taxes during the resolution process. The court refers to both Section 14 of the IBC and various judgments from High Courts and the Supreme Court to support this interpretation.

The court specifically notes that while there is a moratorium on the recovery of tax dues after the admission of the reference, there is no legal barrier to completing assessment and adjudication proceedings. Upon reviewing the impugned orders (Exhibits P-7 to P-10), the court finds that the petitioner was issued a notice, responded to it, and was heard during the finalization of these orders. Therefore, the court dismisses the petitioner’s argument that the absence of the Official Liquidator during the hearing makes the orders invalid.

The judgment concludes by dismissing the writ petition and instructs the Official Liquidator to consider the five claims of the petitioner in accordance with the law.

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