IN THE NATIONAL COMPANY LAW TRIBUNAL

SPECIAL BENCH BENGALURU

(Exercising powers of Adjudicating Authority under
the Insolvency and Bankruptcy Code, 2016)
(Through web-based video conferencing platform

IA No.457 & 458 of 2022 in

CP (IB) No.189/BB/2018

IN THE MATTER OF:

1. I.A. No. 457 of 2022

Jason Nath
A-1206, Abrol Vastu Park
B-Gokul, Evershine Nagar, Malad (West)
Mumbai -400064…Applicant
Versus
Pankaj Srivastava,
Liquidator,
M/s Samruddhi Reality Ltd (in liquidation)
Second floor, No:1, Tate Lane, Richmond Road Cross,
Bangalore -560025 …Respondent

2. I.A. 458 of 2022

Manjinder Singh, USA

2181, Sanburg,
Dunn Loring, VA 22027
USA
Represented by Power of Attorney Holder,
Shri. Vijay Kumar Jagannath,
Bangalore …Applicant
Versus
Pankaj Srivastava,
Liquidator,
M/s Samruddhi Reality Ltd (in liquidation)
Second floor, No:1, Tate Lane, Richmond Road Cross,
Bangalore -560025 …Respondent

Order delivered on: 14th December, 2023

Coram: 1. Hon’ble Justice (Retd.) T. Krishnavalli, Member (Judicial)

2. Hon’ble Shri Manoj Kumar Dubey, Member (Technical)

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Present/Counsels Present:

For the Applicant in I.A. no. 457 & 458 of 2022 :Shri Narendra Kumar
For the Respondent in I.A. no 457 & 458 of 2022 :Shri Abhishek Anand

ORDER

Per: BENCH
I.A No. 457 of 2022

1. The presentapplication is filed on 10.08.2022 by the applicant seeking to

direct the respondent liquidator of M/s Samruddhi Reality Ltd (in
liquidation) to register the Flat No. 14B, 14th Floor in “Samruddhi
Sunshine” in favour of the Applicant after receipt of balance amount of
Rs. 1,00,000/- from the Applicant and to exclude the said Flat from the
Liquidation Estate of the Corporate debtor.
2. The facts of the application as narrated by the applicant is as follows:
a) The Applicant entered into an “Agreement to Sale and
Construction” on 04.05.2013 with respect to an apartment in
“Samruddhi Sunshine” the Applicant had paid to Respondent 97%
of the consideration amounting to Rs. 34,00,000/- out of Rs.
35,00,000/- towards sale and construction of apartment and the
same was registered in the name of the Applicant on 04.05.2013.
The ‘Agreement of Sale and Construction’ was registered with the
Sub-Registrar, Bommanahalli, Bangalore, on 4.05.2013. As per
Clause 7 of the agreement the construction of flat/apartment was
to be completed within 36 months of signing of the said agreement
subject to “force majeure”.
b) It is submitted that without the knowledge of Applicant, the
Corporate Debtor- company in liquidation had entered into
Mortgage Deed with with M/s INDIABULLS HOUSING FINANCE
LTD on 26.07.2016 and one of the flat bearing no. 14B was given as
security to the Mortgagee.
c) The Applicant has obtained encumbrance certificate from the sub-
registrar on 17.06.2020 and on 19.07.2022, which shows that the
flat still stands in the name of the Applicant.
d) The applicant submits that this Tribunal vide order dt.13.03.2020
in CP (IB) No. 189/2018 passed a liquidation order by which the
Respondent Mr. Pankaj Srivastava has been appointed as
Liquidator of M/s Samruddhi Reality Ltd. and that on 17.03.2020
the respondent liquidator made a public announcement inviting

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 claims from the public. In response to the advertisement the
applicant has made a claim of Rs. 99, 00, 735 out of which the
Respondent liquidator had admitted Rs. 50, 69, 721.
e) Further, the applicant has written letter dt.23.07.2022 requesting
the liquidator to register the flat in Applicant’s name and to exclude
the flat/apartment allotted to the applicant from the liquidation
estate of the corporate debtor. The applicant had also proposed to
bear the expenses relating to registration of sale deed as well the
construction of remaining work co-jointly with other flat allottees.
f) It is submitted that the Respondent/liquidator vide reply
dt.11.07.2022 rejected the request of the applicant by stating that
mere agreement to sell or possession over property does not
amount to the ownership of that property and reliance placed on
section 54 of the Transfer of Property Act, 1882. The
respondent/liquidator has relied on the Apex Court’s decision in
the case of NarandasKasondas v. S.A. Kamtam and Anr. (1977) 3
SCC 247 and Suraj Lamp and Industries P. Ltd. v. State of Haryana
and Ors. AIR (2012)206 to state that the ownership is said to
complete only after executing and registering the valid deed of
conveyance.
g) The present application has been filed by the applicant being
aggrieved by the fact that the Flat no.14B in the Schedule Property
B is included in the Liquidation estate of the Corporate Debtor and
that no action is being taken to register the flat vide sale deed in
favour of the applicant.
3. The Learned Counsel for the respondent filed in its objection/written
submission inter alia contenting the following:
a) The respondent is the liquidator of the Corporate Debtor, M/s
Samruddhi Reality Limited and the CD has entered into a
mortgage deed dt.26.07.2016 with Indiabulls Asset
Reconstruction Company (INDIABULLS) vide loan agreements
dt.30.06.2016 for amounts of Rs 3,30,00,000 and Rs.
10,20,00,000 vide which the CD has created mortgage over the
property/flat 14B which is alleged to be in possession of the
applicant. The charge created over the said flat is subsequently
registered with Central Registry of Securitisation Asset
Reconstruction and Security Interest of India (CERSAI).
b) The Respondent avers that the exclusion of the said flat cannot be
granted as the flat is exclusively charged to INDIABULLS(Debt
along with security interest assigned to Assets Care and
Reconstruction Enterprise Ltd. Vide Assignment Deed Dt.
26.04.2021) and the security interest thereof has not been
relinquished towards the liquidation estate of the CD. This issue
of relinquishment of security interest is pending adjudication
before this Tribunal.

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c) Further, INDIABULLS have assigned the entire debt/facility along
with underlying security and all loan and financing documents
together with all the Existing lender’s rights, benefits to Asset Care
& Reconstruction Enterprise (ACRE) acting in it capacity as a
trustee of ACRE-102-Trust and has requested the liquidator to
substitute ACRE’S name in place of INDIABULLS for participating
in Stakeholders Committee Meeting.
d) The Respondent has also denied the contention taken by the
applicant while relying on the Hon’ble NCLAT decision in Alok
Sharma v. M/s I P Construction Pvt. Ltd Through Resolution
Professional Anju Agarwal; CA(AT)(IB) No. 350/2020 wherein the
NCLAT directed the RP to execute the sale of deed in favour of the
allottees. However, the respondent states that the facts of the
instant applicant are distinguishable from the instant application,
as in Alok Sharma case (supra) the application was for approval of
resolution plan and the issue before the NCLAT was whether
registration of sale deed will violate ‘moratorium’ under Section 14
of the Code which prohibits transferring, encumbering, alienating,
or disposing of by the CD any of its assets or any legal right or
beneficial interest. Contrary to the above position, the issue in this
case is whether the Liquidator has the power to register sale deed
during liquidation proceeding and exclude Flat No. 14B from the
liquidation estate which is exclusively charged to INDIABULLS.
Further, the respondent contends that since the moratorium has
ceased to take effect as per Section 14 (4) of the Code and the
subsequent liquidation order has been passed by this Tribunal,
the fact of the instant application and the Alok Sharma (supra)
case are distinct from each other.
e) Moreover, the Respondent states that a mere Agreement to Sell or
possession over a property cannot amount to ownership of that
property as per the terms of Section 54 of the Transfer of Property
Act read with Sections 47, 48 and 49 of the Registration Act which
clarifies the position regarding transfer of property by making the
registration of transfer title a mandatory requirement to establish
ownership.
f) The Respondent, further, relies on the decision of the Apex Court
in the case of NarandasKarsondas v. S.A. Kamtam and Anr.,
(1977) 3 SCC 247which states that an Agreement to sell/Allotment
letter does not create any interest in, or charge on the property
and consequently does not grant ownership right. Moreover, the
title in immovable property is transferred only upon execution of
conveyance (Sale) deed before the Registrar.
g) Lastly, the Respondent has relied on the Apex Court decision in
the case of Suraj Lamp and Industries Pvt. Ltd. v. State of Haryana
and Ors., AIR 2012 2016 which states that it is mandatory for an

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 Agreement to sell to be registered as a deed of conveyance as per
Sections 54 and 55 of Transfer of Property Act without which the
title or any interest in the immovable property (except to the
limited right granted under Section 53A of Transfer of Property
Act) cannot be conferred. Additionally, the word ‘transfer’ is
defined with reference to the word ‘convey’ and as per Section 5
the word is used in the wider sense of conveying ownership which
is only completed on execution and registration of a valid deed of
conveyance.
4. The Learned Counsel for the Applicant filed its Rejoinder vide diary No. 405
dated 20.01.2023.
5. Heard both the Counsels and perused the records available.
6. The present application is filed by the Applicant who has entered into an
‘Agreement of Sale and Construction’ with the Corporate Debtor with
respect to an apartment in the corporate debtor’s project “Samruddhi
Sunshine”. It is seen that the applicant has paid a consideration
amounting to Rs. 34,00,000/- out of Rs. 35,00,000/- towards sale and
construction of apartment and same was registered in the name of the
Applicant on 04.05.2013.
7. The main contention raised by the Liquidator is that the said flat is
exclusively charged to Indiabulls Asset Reconstruction Company Limited
and the said secured financial creditor has not relinquished its security
interest towards the liquidation estate.
8. It is observed that the Applicant has prayed to direct the Liquidator to
register the said flat in favour of the Applicant, however the same is not
tenable, as mere Agreement to sell or possession over a property does not
amount to ownership of that property. It is pertinent to point out that
ownership of a property is attained only through a registered instrument.It
is further seen that said flat is exclusively charged to India bulls Asset
Reconstruction Company Limited and the secured creditor has not
relinquished its security interest over the said flat. Hence it is to be
concluded that the Applicant is not the absolute owner of the property.
9. Similar position has been taken by this Tribunal in the same company
petition i.e.CP (IB) 189 of 2018 vide order dated 25.05.2023 in I.A. No.
343 of 2021. In this application the homebuyers requested for
thepossession of the villas and exclusion of their villas from the
Liquidation estate of the CD on account of: (a) ‘Agreement to Sell’ and
(b) handing over the key to the villa by the CD for making some
improvements inside the villa. However, this Tribunal noted that since
there was no security interest created in favour of the applicants, by
way of Section 3(31) of the Code, the property will be included in the
liquidation estate of the CD. This position was upheld by the Hon’ble
NCLAT, Chennai in CA (AT) (CH) (INS) No. 252/2023 vide order dated
28.08.2023.

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10. In this connection, it is appropriate to cite the judgment regarding
Agreement to Sell without registering a conveyance seed or sale deed in
the case of Suraj Lamp and Industries (supra) wherein the Hon’ble
Supreme Court has held that,
“12. Any contract of sale (agreement to sell) which is not a registered deed
of conveyance (deed of sale) would fall short of the requirements of
Sections 54 and 55 of Transfer of Property Act and will not confer any
title nor transfer any interest in an immovable property (except to the
limited right granted under Section 53A of Transfer of Property
Act).According to Transfer of Property Act, an agreement of sale, whether
with possession or without possession, is not a conveyance. Section 54 of
Transfer of Property Act enacts that sale of immoveable property can be
made only by a registered instrument and an agreement of sale does not
create any interest or charge on its subject matter.”
11. Additionally, the Hon’ble Supreme Court, recently in the case of
Shakeel Ahmed v. Syed Akhlaq Hussain C.A. No. 1598 of 2023 vide order
dated 01.11.2023 has categorically observed that,
“…no title could be transferred with respect to immovable properties on
the basis of an unregistered Agreement to Sell or on the basis of an
unregistered General Power of Attorney. The Registration Act clearly
provides that a document which requires compulsory registration under
the Act, would not confer any right, much less a legally enforceable right
to approach a Court of Law on its basis. Even if these documents i.e.,
the Agreement to Sell and Power of Attorney were registered, still it
could not be said that the respondent would not have acquired title over
the property in question. At best, on the basis of the registered
agreement to sell, he could have claimed relief of specific performance in
appropriate proceedings. In this regard reference may be made to
sections 17 and 49 of the Registration Act and section 54 of the Transfer
of Property Act, 1882.”
12. Lastly, it is rightly pointed out by the Liquidator/Respondent that as
per Section 36(3) of the Code he is required to include all assets over
which CD has ownership rights in the Liquidation Estate whether
tangible or intangible, whether encumbered or unencumbered. Further,
as per Section 35(1) (d) of the Code he is within his power “to take such
measures to protect and preserve the assets and properties of the
corporate debtor as her considers necessary.”
13. Hence, this Tribunal is of the considered opinion that that since no Sale
Deed is registered and no security interest is created in favour of
Applicants, said property falls within the purview of Liquidation Estate of
the Corporate Debtor.
14. Accordingly, I.A 457 of 2022 is dismissed

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I.A. 458 of 2022

1. The present application is filed on 08.08.2022 by the applicant seeking to

direct the respondent liquidator of M/s Samruddhi Reality Ltd (in
liquidation) to register the Flat No. 13A, 13th Floor in “Samruddhi
Sunshine” in favour of the Applicant and to exclude the said Flat from the
Liquidation Estate of the Corporate debtor.

2. The applicant submits that he entered into an ‘Agreement of Sale’ on

14.02.2013 with respect to an apartment in “Samruddhi Sunshine” and
that the applicant had paid 100% of the consideration amount of
Rs27,01,000/- to the respondent towards the sale and construction of the
apartment which was registered in the name of the Applicant on
14.02.2013.

3. The Applicant submits that as per the terms of clause 7 of the said
Agreement the construction of the flat was to be completed within 36
months. However, the respondent/CD without the knowledge of the
applicant, entered into Mortgage Deed with INDIABULLS on 26.07.2016
and one of the flat bearing number 13A was given as security to the
Mortgagee.

4. The Applicant had made a claim of Rs. 1,08,01,888/- out of which the
Respondent liquidator has admitted the claim amounting to Rs
42,31,912/-. The Applicant avers that he has written letters to the
respondent with complete background of the facts of the case and
requested the Liquidator to register the flat in applicant’s name but the
same has been rejected by the respondent.

5. The Learned Counsel for the respondent/Liquidator filed its

objection/written submission to the application, vide diary no. 22 dated
02.01.2023, whereby the contention of the respondent is similar to the
objection filed in the above discussed application I.A. 457 of 2022 in which
the order has been passed today.

6. Heard the Ld. Counsel for the Applicant and the Counsel for the
Respondent.

7. The Tribunal observes that the facts and circumstances of the instant
application are similar to the facts in I.A. No. 457 of 2022 which has been
disposed of by this Tribunal today. Reliance is placed on the observations
made above and on the decisions of the Hon’ble Apex Court in Suraj Lamp
and Industries P. Ltd. v. State of Haryana and Ors. AIR (2012)206and
Shakeel Ahmed v. Syed Akhlaq Hussain C.A. No. 1598 of 2023 along

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 with the decision of the Hon’ble NCLAT, Chennai in CA(AT) (CH) (Ins)
No. 252/2023vide order dt.28.08.2023, wherein the NCLAT has
affirmed the decision of this Tribunal in CP(IB) No. 189 of 2018, I.A. No.
343 of 2021, order dt.25.05.2023. Accordingly, we are of the considered
opinion that since no Sale Deed is registered and no security interest is
created in favour of Applicants, the said property falls within the purview of
Liquidation Estate of the Corporate Debtor.

8. Accordingly, I.A 458 of 2022 is dismissed.

-Sd/- -Sd/-
MANOJ KUMAR DUBEY T. KRISHNAVALLI
MEMBER (TECHNICAL) MEMBER (JUDICIAL)