1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN ITS INSOLVENCY JURISDICTION NOTICE OF MOTION NO. 67 OF 2009 IN INSOLVENCY PETITION NO. 46 OF 2002 Ref : B.D. Agarwal & Another .. Insolvent Ex-parte : Mr. G.C. Shah .. Petitioning Creditors And Krystal Stone Exports Ltd .. Applicant V/s Official Assignee, High Court, Bombay & Anr. .. Respondents WITH NOTICE OF MOTION NO. 68 OF 2009 IN INSOLVENCY PETITION NO. 46 OF 2002 Ref : 1. Bansi Dhar Agarwal 2. Mrs. Sangeeta B. Agarwal .. Insolvents Ex-parte : Ghisalal C. Chsh .. Applicants And Central Bank of India .. Applicants And RMA 8nmis67-09&68-09.sxw 2 The Official Assignee .. Respondent WITH REPORT NO. 8 OF 2009 IN INSOLVENCY PETITION NO. 46 OF 2002 Ref : 1. Bansi Dhar Agarwal 2. Mrs. Sangeeta B. Agarwal .. Insolvents Ex-parte : Ghisalal C. Chsh .. Pet. Creditor Mr. S.A. Tawate for the applicant Krystal Stone Exports Ltd Mr. Y.C. Parikh, Official Assignee present Mr. O.A. Das for Central Bank of India CORAM : DR. D.Y. CHANDRACHUD, J. DATE : 1st DECEMBER, 2009 P.C.: 1. The act of the insolvency was committed on 26th March, 2002 and the order of adjudication was passed on 3rd June, 2003. The official Assignee took symbolic possession of the residential flat. The Central Bank of India had instituted proceedings before the Debt Recovery Tribunal, Jaipur. Pursuant to the order dated 10th January, 2008 passed in those proceedings, the Debt Recovery Tribunal handed over symbolic possession to the Receiver RMA 8nmis67-09&68-09.sxw 3 appointed by the Tribunal on 22nd January, 2008. By an order dated 24th August, 2009, the Debt Recovery Tribunal directed that possession of the property be handed over to the official Assignee. However, it was clarified that if the law permits the Central Bank to take possession under the Securitisation Act , it may act in accordance with law. 2. The Central Bank of India has taken out a notice of Motion for a direction to the official Assignee to handover possession of the flat since the bank has instituted proceedings under the Securitisation Act. The bank had issued a notice under Section 13(2) on 11th July, 2002 after which a notice of possession was issued on 16th February, 2009. The bank is a secured creditor. In these circumstances, notice of Motion 68 of 2009 taken out by the Central Bank of India is made absolute in terms of prayer clause (a) save and except for the bracketed portion which reads as follows : "(a) that the learned official Assignee, High Court, Bombay, maybe directed to handover the flat being Flat No. 305, Blace View "A" Co-operative Housing Society Limited, Matherpada Road, Amboli, Andheri (West), Bombay 400 058, to the RMA 8nmis67-09&68-09.sxw 4 Applicants, Central Bank of India, Tonk Road Branch, Jaipur." 3. So far as the notice of Motion 67 of 2009 is concerned, the prayer of the applicant is that the official Assignee be ordered to restore possession of the flat to the applicant. The applicant is a company by the name of ‘Krystal Stone Exports Limited’. The applicant relies upon a lease agreement dated 11th April, 1996 entered into by insolvent no. 2 Smt. Sangita B. Agarwal, who is or in any event was at the material time, the wife of Insolvent No. 1 who was a director of the company. The lease agreement, which is for a period of 15 years, has not been registered. The Lease rental is an amount of Rupee one. But that apart, the official Assignee took symbolic possession, as stated in the report of the official Assignee dated 30th September, 2009. If the applicant has any grievance as against the Bank for having taken forcible possession as is alleged, it would be open to the applicant to take recourse according to law. Since the Official Assignee did not take actual or forcible possession, no such direction can be issued against the Assignee. Notice of Motion 67 of 2009 which seeks a direction to the Official Assignee cannot, for these reasons, be allowed and is accordingly RMA 8nmis67-09&68-09.sxw 5 dismissed. 4. The Official Assignee has in his report sought an order authorizing him to terminate the lease agreement entered into between insolvent no. 1 and Krystal Stone Exports on the ground that the lessee has committed a breach of the agreement. The official Assignee has pointed in paragraph 7 of the report that the lessee has committed default in payment of society charges and submitted that in terms of clause (10) of the agreement, the agreement is liable to be terminated. Upon the order of adjudication, the property has vested in the official Assignee. The official Assignee is accordingly granted permission in terms of prayer clause (a) of the report to terminate the agreement. Prayer clause (b) of the report of the Official Assignee will not survive in view of the directions issued separately in the Motion taken out by Central Bank of India for handing over of possession to the Central Bank of India which is exercising powers under the Securitisation Act. 5. There shall be an order in these terms. 6. Stay refused. ........... RMA 8nmis67-09&68-09.sxw 6 RMA 8nmis67-09&68-09.sxw