# In the matter of SREI Infrastructure Finance Ltd. Vs. Sundresh Bhatt, RP Sterling Biotech Ltd. CA(AT)(Insolvency) NO. 781-2019

> NCLAT judgment dated 2019-07-31. Citation: TCN-2019-NCLAT-00393. The case involves an appeal against an order passed by the Adjudicating Authority (National…

- **Court:** NCLAT
- **Order date:** 31 Jul 2019
- **Citation:** TCN-2019-NCLAT-00393
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/srei-infrastructure-finance-ltd-vs-sundresh-bhatt-rp-sterling-biotech-ltd-ca-0d93fed9

## Summary

### Background

The case involves an appeal against an order passed by the Adjudicating Authority (National Company Law Tribunal), Mumbai Bench-I, Mumbai. The Appellant, a ‘Financial Creditor' of a related entity of 'Sterling Biotech Limited’ (‘Corporate Debtor'), challenged the order. The Resolution Professional had filed an application seeking directions against the Appellant to return the physical possession of the ‘B' Wing premises of Lakshmi Towers to the 'Resolution Professional' and to restrain the Appellant from taking any action in relation to ‘A' Wing premises pursuant to the notices issued by the Appellant under Section 13(4) of the ‘SARFAESI Act.' The Adjudicating Authority allowed the application and directed the Appellant to return the physical possession of the ‘B’ Wing

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## Facts

The Appellant, Srei Infrastructure Finance Ltd., is a financial creditor of Sterling Biotech Limited (Corporate Debtor). The Resolution Professional, Sundresh Bhatt, filed an application seeking the return of physical possession of premises in Lakshmi Towers from the Appellant. The Adjudicating Authority directed the Appellant to return the ‘B’ Wing premises and restrained action regarding the ‘A’ Wing premises under the SARFAESI Act. The Appellant argued that the premises do not belong to the Corporate Debtor and are third-party property, making the moratorium under Section 14 of the I&B Code inapplicable. The Resolution Professional acknowledged that the premises do not belong to the Corporate Debtor but stated that the Corporate Debtor's office operates from the

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority was correct in directing the Appellant to hand over possession …

**Ratio:** The Corporate Debtor cannot be ejected or disturbed from the premises, even if the

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**Reasoning:** The court reasoned that the Adjudicating Authority rightly directed the Appellant to hand

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**Interpretation:** Section 14(1)(d) of the I&B Code is interpreted to protect the Corporate

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**Application:** The ratio and reasoning were applied to uphold the Adjudicating Authority's

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## Parties

- **Judges:** S.J. Mukhop…; A.I.S. C…; +1 more
- **Appellants:** Srei Infrastructur…
- **Respondents:** Sterling Biotech…; Sundresh…

## Timeline

- **2018-12-07 — Order by Adjudicating…**: The Adjudicating Authority (National Company Law Tribunal), Mumbai Bench-I, Mumbai,…
- **2019-07-31 — Appeal by Financial…**: The Appellant, a ‘Financial Creditor' of a related entity of 'Sterling Biotech Limited’,…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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