# In the matter of Shree Vaishnav Casting Private Limited M.A. No. 3691 of 2019 in C.P. (IB) No. 2298-MB-2018

> NCLT judgment dated 2021-04-12. Citation: TCN-2021-NCLT-02404. The case involves an application filed under Section 60(5)(c) of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 12 Apr 2021
- **Citation:** TCN-2021-NCLT-02404
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/shree-vaishnav-casting-private-limited-ma-no-3691-of-2019-in-cp-ib-no-2298-mb-20-61041597

## Summary

### Background

The case involves an application filed under Section 60(5)(c) of the Insolvency and Bankruptcy Code, 2016 (IBC) by the Resolution Professional (RP) of Shree Vaishnav Casting Pvt. Ltd., seeking to quash a notice issued by Maharashtra Industrial Development Corporation Limited (MIDC) for termination of a lease agreement and repossession of land allotted to the Corporate Debtor. The Corporate Insolvency Resolution Process (CIRP) was initiated against the Corporate Debtor on 11.03.2019, and the RP was appointed on 10.05.2019. The MIDC issued a show cause notice on 01.11.2018, prior to the CIRP, for violating the lease conditions, specifically the failure to complete construction within the stipulated time. The RP argues that the MIDC's actions violate the moratorium under

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## Facts

1. The Corporate Debtor, Shree Vaishnav Casting Private Limited, was undergoing Corporate Insolvency Resolution Process (CIRP) initiated on 11.03.2019.
2. Santanu T. Ray was appointed as the Resolution Professional (RP).
3. Maharashtra Industrial Development Corporation Limited (MIDC) had leased an industrial plot (B-11) in the Dindori Industrial Area to the Corporate Debtor for 95 years from 21.01.2015.
4. The lease deed, dated 12.05.2015, stipulated that the Corporate Debtor should complete construction of at least 8,224 sq. mtrs by 19.01.2017.
5. The Corporate Debtor availed financial facilities from Dewan Housing Finance Corporation Limited (DHFCL) aggregating to Rs.7,22,80,214 against the security of the leasehold land.
6. A tripartite agreement dated 26.05.2015 was

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## Issues and analysis

### Issue 1: Whether the actions of Maharashtra Industrial Development Corporation Limited (MIDC) to terminate …

**Ratio:** Section 14(1)(d) of the IBC imposes a moratorium on the recovery of any property by an

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**Reasoning:** The court reasoned that the MIDC's action in seeking possession of the leased land during

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**Interpretation:** Section 14(1)(d) is interpreted to mean that during the moratorium period, no

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**Application:** In this case, the court applied the ratio of Rajendra K. Bhutta's case and the

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## Parties

- **Judges:** Janab Mohammed…; V. Nallasen…
- **Appellants:** Santanu T…
- **Respondents:** Shree Vaishnav…; Maharashtra…

## Timeline

- **2015-01-21 — Lease Agr…**: MIDC leased an industrial plot (B-11) to…
- **2015-05-12 — Lease De…**: Lease Deed dated 12.05.2015 provided that the Corporate Debtor had to complete…

## 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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