# In the matter of Rashmi Housing Private Limited

> NCLT judgment dated 2023-06-21. Citation: TCN-2023-NCLT-02860. The case pertains to an Interlocutory Application (I.A. 1342 of 2022) filed in connection with…

- **Court:** NCLT
- **Order date:** 21 Jun 2023
- **Citation:** TCN-2023-NCLT-02860
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/rashmi-housing-private-limited-15ff6d94

## Summary

### Background

The case pertains to an Interlocutory Application (I.A. 1342 of 2022) filed in connection with a Corporate Insolvency Resolution Process (CIRP) initiated against Rashmi Housing Private Limited (Corporate Debtor) under CP (IB) 3119 of 2018. The Resolution Professional (RP) sought directions against the Respondents under Section 74 and Section 60(5) of the Insolvency and Bankruptcy Code (IBC) due to alleged illegal conduct by the Suspended Directors, specifically concerning the sale of flats/units during the CIRP period. The RP's application also sought the cancellation of sale transactions for 82 flats allegedly sold during the moratorium period and appropriate penal orders against the Respondents for contravening the provisions of the Code.

## Facts

The Corporate Insolvency Resolution Process (CIRP) was initiated against Rashmi Housing Private Limited on 2018-12-14. The Resolution Professional (RP) filed an application alleging that the Suspended Directors (Respondents 1-3) illegally sold 82 flats/units during the CIRP period, violating the moratorium under Section 14 of the Insolvency and Bankruptcy Code (IBC). The RP argued that these sales were conducted without valid authority or approval and at slashed prices. The RP also contended that the Suspended Directors granted wrongful occupation of 184 Units/Flats and there are 36 illegal occupants that are in wrongful possession. The Suspended Directors denied the allegations, claiming they were not involved in day-to-day operations and that the sales were conducted

…

## Issues and analysis

### Issue 1: Whether the flats sold by the Respondent nos. 1-3 more fully described in the list annexed by the …

**Ratio:** Section 14 of the Insolvency and Bankruptcy Code (IBC) imposes a moratorium that

…

**Reasoning:** The NCLT reasoned that the sale transactions occurred during the CIRP period,

…

**Interpretation:** Section 14 of the IBC is interpreted strictly to prevent any transfer or

…

**Application:** The NCLT applied the ratio of Section 14 to the facts of the case, finding that

…

## Parties

- **Judges:** H.V. Subb…; Madhu S…
- **Appellants:** Om Prakash…
- **Respondents:** Rashmi Housing…; Vistra ITCL…

## Timeline

- **2018-12-14 — CIRP Init…**: Corporate Insolvency Resolution Process (CIRP) initiated against Rashmi Housing Private…
- **2020-09-14 — RP Email to Suspended…**: Resolution Professional issued an email to the Suspended Directors, seeking clarification…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 74 — Punishment for contravention of moratorium or the…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-74)

---

This is a preview. The full structured summary, issues, precedents and source judgment are available on CaseEase - Legal Intelligence Simplified: https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/rashmi-housing-private-limited-15ff6d94