{"id":283175,"date":"2023-02-04T15:30:00","date_gmt":"2023-02-04T10:00:00","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=283175"},"modified":"2025-01-23T11:26:09","modified_gmt":"2025-01-23T05:56:09","slug":"adjudicating-authority-cannot-direct-resolution-professional-to-pay-lease-amount-during-cirp","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2023\/02\/04\/adjudicating-authority-cannot-direct-resolution-professional-to-pay-lease-amount-during-cirp\/","title":{"rendered":"National Company Law Appellate Tribunal | Adjudicating Authority cannot direct Resolution Professional to pay lease amount during CIRP"},"content":{"rendered":"
\n

National Company Law Appellate Tribunal:<\/b> While deciding the appeal, Rakesh Kumar Jain J. and Naresh Salecha (Technical Member), held that similar grant or right in explanation appended to Section 14(1)(d)<\/a> of Insolvency and Bankruptcy Code, 2016<\/a>, must be read in respect of the licence, permit, registration, quota, concession, clearance but it cannot be read as the premium amount or lease rent.<\/p>\n

Background<\/b><\/p>\n

The respondent filed an application before Adjudicating Authority for a direction to the appellant to make the payment of the lease premium amount due which have become due during the Corporate Insolvency Resolution Process (“CIRP”). The Adjudicating Authority allowed the application. The respondent filed this appeal against the order of the Adjudicating Authority.<\/p>\n

The question before the Tribunal is whether the Adjudicating Authority has rightly applied the explanation under Section 14(1)(d)<\/a> of the Insolvency and Bankruptcy Code, 2016<\/a> (“Code”) for the purpose of directing the Appellant to pay the lease premium amount and the lease rent to the Respondent?<\/p>\n

The Tribunal perused Section 14 of the Code and said that Section 14(1)(d) of the Code says that there would be a prohibition from the recovery of any property by an owner or lessor where such property is occupied by or in the possession of the corporate debtor. However, explanation appended to Section 14(1)(d) of the Code says that with the prohibition of recovery of any property by an owner or lessor, a license, permit, registration, quota, concession, clearance or a similar grant or right either given by the Central Government, State Government, local authority, sectoral regulator or any other authority constituted under any other law for the time being in force, shall not be suspended or terminated on the grounds of insolvency but there would be a condition for its continuation if there is no default in payment of the dues of such license, permit, registration, quota, concession, clearance or a similar grant or right during the moratorium period.<\/p>\n

The Tribunal further said that the similar grant or right must be read in respect of the licence, permit, registration, quota, concession, clearance but it cannot be read as the premium amount or lease rent which has been so ordered by the Adjudicating Authority to be paid by the appellant to the respondent.<\/p>\n

Thus, the Tribunal held that the order passed by the Adjudicating Authority is patently illegal and deserves to be set aside.<\/p>\n

[Sunil Kumar Agrawal v. New Okhla Industrial Development Authority, 2023 SCC OnLine NCLAT 33<\/a>, decided on 12-01-2023<\/span>]<\/p>\n\n

Advocates who appeared in this case :<\/p>\n

Counsel for Appellant:- Advocate Rakesh Kumar, Advocate Ankit Sharma, Advocate Dhruv Gupta, Advocate Lav Dhawan;<\/p>\n

Counsel for Respondents:- Advocate Rachit Mittal, Advocate Parish Mishra, Advocate Adarsh Srivastava, Advocate Pooja Kapur, Advocate Kumar Mihir.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

National Company Law Appellate Tribunal held that Adjudicating Authority cannot direct Resolution Professional to pay lease amount under Section 14(1)(d)<\/a> of Insolvency and Bankruptcy Code, 2016<\/a>, during CIRP<\/i><\/p>\n","protected":false},"author":67011,"featured_media":279124,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3,11],"tags":[22814,54988,22074,22014],"class_list":["post-283175","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-casebriefs","category-tribunals_commissions_regulatorybodies","tag-corporate-insolvency-resolution-process","tag-lease-premium-amount","tag-moratorium","tag-nclat"],"yoast_head":"\nNational Company Law Appellate Tribunal | Adjudicating Authority cannot direct Resolution Professional to pay lease amount during CIRP | SCC Times<\/title>\n<meta name=\"description\" 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