# In the matter of Lanco Infratech Limited IA No. 380-2018 In CP (IB) No. 111-7-HYD-230-2017

> NCLT judgment dated 2019-02-12. Citation: TCN-2019-NCLT-04880. IDBI Bank Ltd, the applicant, filed an application under Section 60(5) of the IBC, 2016,…

- **Court:** NCLT
- **Order date:** 12 Feb 2019
- **Citation:** TCN-2019-NCLT-04880
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/lanco-infratech-limited-ia-no-380-2018-in-cp-ib-no-111-7-hyd-230-2017-8b5b0fed

## Summary

### Background

IDBI Bank Ltd, the applicant, filed an application under Section 60(5) of the IBC, 2016, seeking the termination of a lease agreement between the applicant and Lanco Infratech Limited, the corporate debtor. The applicant also sought a direction to the Resolution Professional (RP) to rule out any option of continuing the lease deed in any resolution plan related to the corporate debtor. The lease agreement, initially entered into between M/s Gulati Export House and the Corporate Debtor on 19.12.2008, was later acquired by the Applicant through a sale deed dated 27.10.2010. The lease was for a term of 9 years, expiring on 19.12.2017, and was not renewed. Following the initiation of CIRP against the Corporate Debtor based on a petition filed by IDBI under Section 7 of

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## Facts

1. A lease agreement was entered into on 19.12.2008 between M/s Gulati Export House and Lanco Infratech Limited (Corporate Debtor) for a term of 9 years, expiring on 19.12.2017.
2. IDBI Bank Ltd (Applicant) acquired the leased premises through a sale deed dated 27.10.2010, becoming entitled to lease rentals.
3. CIRP was initiated against Lanco Infratech Limited based on a petition filed by IDBI under Section 7 of IBC.
4. The Applicant filed a claim for Rs.8,40,75,000/- towards pending rent since August 2016.
5. The Applicant sent a letter on 22.01.2018 informing the IRP about the expiry of the lease agreement and expressed unwillingness for further renewal.
6. The Corporate Debtor continues to occupy the premises even after the expiry of the lease agreement.
7. The Tribunal

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## Issues and analysis

### Issue 1: Whether the Applicant can initiate legal proceedings against the Corporate Debtor during …

**Ratio:** Section 33(5) of the IBC stipulates that when a liquidation order has been passed, no

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**Reasoning:** The Tribunal reasoned that the liquidation order passed on 27.08.2018 triggered the

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**Interpretation:** Section 33(5) is interpreted as a mandatory provision that restricts any new

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**Application:** In this case, since a liquidation order was passed against Lanco Infratech

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## Parties

- **Judges:** Ratakonda…; Ratakonda…
- **Appellants:** IDBI Bank…
- **Respondents:** Lanco Infratech…; Lanco Infratech…

## Timeline

- **2008-12-19 — Lease Agr…**: M/s Gulati Export House and Lanco Infratech…
- **2010-10-27 — Sale Dee…**: IDBI Bank Ltd acquired the leased…

## 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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