Haryana

Kurukshetra

CC/401/2020

Smt Seema Rani W/o Lt Sh Ved Parkash - Complainant(s)

Versus

Dewan Housing Finance Corporation - Opp.Party(s)

Ashish Deswal

15 Sep 2021

ORDER

Seema Rani and others Vs. DHFL                           (CC No.401/2020)

Present:     Sh.Ashish Deswal Advocate for the complainant.

                 Sh.Shekhar Kapoor Advocate for OP No.1 and 3.

                 Sh.Sunil Saini Advocate for OP No.2.

                 Sh.Gaurav Gupta Advocate for OP No.4.

 

ORDER: 

                      By this order, we shall dispose of an application filed on  behalf of OP No.1-Dewan Housing Finance Corporation Limited (DHFL), u/s 14 of the Insolvency and Bankruptcy Code 2016 as amended upto date read with rule 5 (b) (i) of the Insolvency and Bankruptcy (insolvency and Liquidation  Proceedings of Financial Service Providers and Application to Adjudicating Authority) Rules 2019  for passing appropriate and necessary orders for stay of the present consumer proceedings. It is alleged in the application the Reserve Bank of India has filed on 29.11.2019 an application for initiation of Corporate Insolvency Resolution Process against Dewan Housing Finance Corporation Limited, under Section 227 read with clause (zk) of sub section (2) of Section 239 of the Insolvency and Bankruptcy code (IBC) 2016 read with Rules 5 and 6 of the Insolvency and Bankruptcy  ( Insolvency and Liquidation Proceedings of Financial  Service Providers and Application  to Adjudication Authority) Rules 2019. It is further alleged that as per the mandate of the Section 14 Sub Section (1), (2) and (3) of the Insolvency and Bankruptcy Code 2016 as amended upto date, a moratorium will be declared for prohibiting the institution of suits or continuation of suits. It is further alleged that in addition to the above said provision of law, Rule 5(b)(1) of the Insolvency and Bankruptcy Rules 2019 (FSP Rules) mandates that an interim moratorium shall commence on and from the date of filing of the application till its admission or rejection. The explanation to Rule 5(b) of the FSP Rules that “ interim moratorium shall have the effect of the provisions of sub sections (1), (2) and  (3) of Section 14 of the Insolvency and Bankruptcy Code, 2016 as amended upto date.  It is further alleged that after filing the application by the RBI, The National Company Law Tribunal, Mumbai Bench  has admitted the application filed by the RBI and passed inter alia the following order on 3.12.2019 which is reproduce4d as under (para 7.4 of the order):-

 

“ Upon Admission it is hereby pronounced that “ Moratorium” as defined u/s 14 of the Insolvency Code shall commence with effect from the date of Application i.e. 29.11.2019 as prescribed under Rule 5 (b)(i) of FSP Rules, 2019.  On commencement of “Moratorium” the institution of any Suit or continuation of proceedings or execution of any decree against the Financial  Service  Provider shall be prohibited. Likewise, alienating or deposing of any asset of the FSP is hereby forbidden. Further any action to foreclosure, recover or enforce any security  interest created by FSP (Financial Service Provider) in respect of its property is also debarred. However,  supply of essential goods or services to FSP shall continue uninterrupted and not to be  terminated or suspended during “Moratorium” by the Supplier.   As prescribed under Section 14(4), the Order of  “Moratorium shall have effect till the completion of Insolvency Process.”

 

                From the above cited statutory provisions and the abovesaid order, it is evident that interim moratorium commences on and from the date of filing of the application till its admission or rejection. Since, the application has been  filed by the Reserve Bank of India on 29.11.2019 so from the said date, the interim moratorium has commenced. Further, on passing of the order dated 3.12.2019 passed by the National Company Law Tribunal, Mumbai Bench (for short NCLT) in CP (IB)-4258/MB/2019 titled as Reserve Bank of India Versus Dewan Housing Finance Corporation Limited, moratorium u/s 14 has commenced from the date of said order.  In view of the abovesaid circumstances,  details and provisions of the law and order mentioned above, the present proceedings against the corporate debtor i.e. the applicant Dewan Housing Finance Corporation Limited cannot continue on the present proceedings, therefore, an appropriate and necessary orders are required to be passed by this Commission in this regard.

 

2.             The application has been resisted by the complainant by filing reply with the averments that present application is not maintainable as the same has been filed by the OP just to delay the proceedings of the present complaint. Complainant moved the present complaint just to make the payment of the loan but OP is creating hindrances in this regard by saying that they have demanded foreclosure amount without observing the guidelines of Reserve Bank of India. However, OP instead of filing the reply to the complaint, moved the present application by taking plea which have no concern whatsoever with the complainant. The other allegations made in the application have been denied by the complainant.

 

3.     Learned counsel of OP No.1/applicant has given the authority upon the  of Hon’ble National Commission in case titled as Vinay Kumar Mittal and Ors. Versus Dewan Housing Finance Corporation Limited and Ors. In Civil Appeal No.654-660 of 2020 on 31.01.2020 at the time of arguments.  The para No.15 of the said judgment reproduced as under:

        “After considering the submissions made by Mr.Jayant Bhushan, learned Senior counsel for the Appellants, Mr.Ramji Sriniyasan, Learned Senior counsel for the Administrator and Mr.V.K.Vishwanathan, learned Senior Counsel for the RBI and  in view of the order that we propose to pass, we deem it not necessary to examine the merit of the contentions made by the Learned  Senior Counsel. The depositors are being represented by the Authorized Representative before the Committee of the Creditors. We leave it open to the Appellants to raise all points and contentions before the Committee of Creditors, the Administrator and if necessary, the NCLT. In view of the above we are not inclined to interfere with the decision of the Committee of Creditors taken on 30.12.2019. We are  informed that there are nearly one lakh depositors who have invested their life time earnings with respondent no.1. Some of the depositors have matured and some of the depositors are critically ill. We have no doubt that the concerns of the depositors and their rights shall be considered in accordance with law.

4.             Further, learned counsel for OP has also placed reliance upon the judgments of Hon’ble Supreme Court of India titled as Ghanshyam Mishra and sons Private Limited through its authorized signatory Vs. Edelweiss Asset Reconstruction Company Limited through the Director and others (2021)5 SCALE 653 decided on 13.4.2021 in which Hon’ble Supreme Court has held that

  “Once a resolution plan is duly approved by the Adjudicating Authority under sub-section (1)of Section 31, the claims as provided in the resolution plan shall stand frozen and will be binding on the Corporate Debtor and its employees, members, creditors, including the Central Government any State Government or any local Authority, guarantors and other stakeholders- On the date of approval of resolution  plan  by the Adjudicating Authority, all such claims, which are not a part of resolution plan, shall stand extinguished and no person will be entitled to initiate or continue any proceedings in respect to a claim, which is not part of the resolution plan- 2019 amendment to Section 31 of the I& B Code is clarificatory and declaratory in nature and therefore will be effective from the date on which I & B Code has come into effect-Government, any State Government or any local authority, if not part of the resolution plan, shall stand extinguished and no proceedings in respect of such dues for the period prior to the date on which the Adjudicating Authority  grants its approval under Section 31 could be continued.”

5.             Arguments heard on the application.

6.             As per the order dated 3.12.2019 referred   here-in before,  “Moratorium” as defined u/s 14 of the Insolvency Code shall commence with effect from the date of Application, as prescribed under Rule 5(b)of FSP Rules 2019. On commencement of “Moratorium” the institution of any suit or continuation of proceedings or execution of any  decree against the opponent is prohibited. Likewise, alienating or deposing of any asset of the FSP is hereby forbidden. Further any action to foreclosure, recover or enforce any security interest created by FSP (Financial Service Provider) in respect of its property is also debarred.

7.             The question of law is whether after declaring a company insolvent under the Insolvency and Bankruptcy (insolvency and Liquidation Proceedings of Financial Service Providers and Application to Adjudicating Authority) Rules 2019  by the court, this commission can decide this case  or not. In our opinion, the answer is in negative. Hence, due to foregoing reasons, this Commission is not required to proceed ahead with this complaint. Without commenting anything on merits, of the complaint, further proceedings are hereby ordered to be closed. As observed by the Hon’ble Supreme Court in the above judgment that once as resolution plan is duly approved by the Adjudicating Authority under subsection (1)of Section 31, the claims as provided in the resolution plan shall stand frozen and will be binding on the Corporate Debtor and its employees, members creditors, guarantors and other stakeholders. On the date of approval of resolution plan by the Adjudicating Authority, all such claims, which are not a part of resolution plan, shall stand extinguished and no person will be entitled to initiate or continue any proceedings in respect to a claim which is not part of the resolution plan; 2019 amendment to Section 31 of the I & B Code is clarificatory  and declaratory in nature and therefore will be effective from the date on which I & B Code has come into effect. Consequently, all the dues including the statutory dues owned to the Central Government , any State Government or any local authority, if not part of the resolution plan, shall stand extinguished and no proceedings in respect of such dues for the period prior to the date on which the Adjudicating Authority grants its approval under Section 31 could be continued.

                Hence, due to foregoing reasons, this Commission is not required to proceed ahead with this complaint. Without commenting anything on merits of the complaint, further proceedings are hereby ordered to be closed.

8.             In view of the law discussed in the cited authorities, the application filed u/o 1 rule 10 of the CPC on behalf of the complainant is also dismissed.  The parties concerned be communicated of the order accordingly and the file be consigned to the record room after due compliance.

Announced in the open Commission:

Dated: 15.09.2021.                                           President.

 

 

                                Member.