19 February 2020
Supreme Court


Case number: C.A. No.-012248 / 2018
Diary number: 47825 / 2018





CIVIL APPEAL NO. 12248 OF 2018

RAJENDRA K. BHUTTA       …Appellant




R.F. Nariman, J.

1. This appeal raises a question as to the correct interpretation

of Section 14(1)(d) of the Insolvency and Bankruptcy Code, 2016

(hereinafter  referred  to  as  “the  Code”).  The  facts  necessary  to

appreciate the setting in which this question arises are as follows:

i. On 01.11.2007, a Resolution bearing No.6280 was passed

by the Maharashtra Housing and Area Development Authority

(hereinafter  referred to as ‘the MHADA’)  to execute a joint

development agreement with the Corporate Debtor, i.e. Guru

Ashish  Construction  Private  Limited,  and  Goregaon

Siddharth Nagar Sahakar Griha Nirman Sanstha Limited (a

Society for persons who are displaced and who are to be re-

housed  in  the  project  for  joint  development  of  land,  ad-



measuring about 40 acres), which envisaged re-development

insofar  as  672  tenements  in  Siddharth  Nagar,  Goregaon,

Mumbai were concerned.

ii. On 03.03.2008, the Maharashtra State Government granted

its approval to the aforesaid Resolution.

iii. On  10.04.2008,  a  Tripartite  Joint  Development  Agreement

(hereinafter  referred  to  as  the  “Joint  Development

Agreement”)  was  entered  into  between  the  Society

representing persons occupying 672 tenements, MHADA and

the Corporate Debtor.

iv. On  25.03.2011,  a  Loan  Agreement  was  entered  into  and

executed between the Union Bank of India and the Corporate

Debtor for a sum of Rs. 200 Crores.

v. On  09.11.2011,  a  Deed  of  Modification  was  entered  into

between  the  three  parties  to  the  Joint  Development

Agreement,  as after  carrying out  the survey of  the land in

question, it was found that certain parcels of land, which were

identified with certain city survey numbers, were omitted, as a

result of which they were also added, now making the project

for a total of 47 acres of land.

vi. As a result of the Corporate Debtor defaulting in repayment

of the loan to its financial creditor, namely, the Union Bank of



India, an Insolvency Application under Section 7 of the Code,

which was filed on 15.05.2017, was admitted on 24.07.2017,

appointing  an  Interim  Resolution  Professional  (i.e.  the

Appellant  before us).  A moratorium in terms of  Section 14

was also declared by this order.

vii. On 12.01.2018 - after the imposition of the moratorium period

under Section 14 of the Code - MHADA issued a termination

notice to the Corporate Debtor stating that upon expiry of 30

days  from  the  date  of  receipt  of  the  notice,  the  Joint

Development  Agreement  as  modified  would  stand

terminated. It  was further stated that the Corporate Debtor

would have to handover possession to MHADA, which would

then enter  upon the  plot  and  take possession  of  the  land

including all structures thereon.   

viii. One hundred and eighty days from the start of the Corporate

Insolvency Resolution Process (hereinafter referred to as “the

CIRP”)  expired  on  19.01.2018.  The  NCLT,  by  order  dated

24.01.2018, extended the CIRP period by ninety days, as is

permissible under the Code.

ix. On  01.02.2018,  the  Appellant  filed  M.A.  No.  96  of  2018,

seeking a direction from the NCLT to restrain MHADA from

taking over possession of the land till completion of the CIRP,



contending  that  such  a  recovery  of  possession  was  in

derogation of the moratorium imposed under Section 14 of

the Code. The NCLT, by order dated 02.04.2018, dismissed

the aforesaid application, stating that Section 14(1)(d) of the

Code  does  not  cover  licenses  to  enter  upon  land  in

pursuance  of  Joint  Development  Agreements,  stating  that

such  licenses  would  only  be  ‘personal’  and  not  interests

created  in  property.  An  appeal  against  this  order  was

preferred to the NCLAT.

x. Meanwhile,  in  a  parallel  proceeding,  on  18.04.2018,  the

amount of time taken by the NCLT in deciding the application

under Section 7 under the Code, being 55 days, was sought

to be omitted from the total number of days allowable under

the Code. This application was partially granted, excluding 38

out of 55 days. An appeal to the NCLAT proved successful,

whereby the NCLAT, by order dated 09.05.2018, allowed the

appeal and allowed the entire 55 days so taken before the

NCLT to be excluded.

xi. On 03.07.2018, the Appellant filed an approved Resolution

Plan before the NCLT, Mumbai by way of I.A. No.21433 of

2018.  We  are  informed  that  this  was  within  the  extended

period of 55 days so granted by the NCLAT. It may only be



mentioned that the Resolution Plan was approved by 86.16%

of the Committee of Creditors. Ultimately, the NCLAT, by the

impugned order dated 14.12.2018, (after omitting to refer to

the order dated 09.05.2018), stated that 270 days are over,

as a result of which the entire discussion of Section 14(1)(d)

would now become academic. However, it also decided:

“14. On perusal of record, we find that pursuant to the ‘Joint Development Agreement’ the land of the  ‘Maharashtra  Housing  and  Area Development Authority’ was handed over to the ‘Corporate Debtor’ and ‘except for development work’ the ‘Corporate Debtor’ has not accrued any right over the land in question. The land belongs to  the  ‘Maharashtra  Housing  and  Area Development  Authority’  which  has  not  formally transferred it in favour of the ‘Corporate Debtor’. Hence, it cannot be treated to be the asset of the ‘Corporate Debtor’ for application of provisions of Section 14(1)(d) of the ‘I&B Code’.”

2. Mr. Dhruv Mehta, learned Senior Advocate appearing for the

Appellant, has taken us through the Joint Development Agreement

together  with  the  Deed  of  Modification  in  great  detail.  His  first

submission is that it would be wholly incorrect to state that a mere

‘license to enter’ had been granted. According to him, if these two

documents were read as a whole, it is clear that legal possession

was actually  handed over  to  him in order  to  do three things:  (1)

construct tenements which were to be handed over to MHADA free

of cost; (2) construct tenements in which the 672 occupiers of the



erstwhile tenements were to be housed; and (3) thereafter recoup

costs  and  make profit  by  sale  of  what  was  called  the  ‘free  sale

component’ that would be left over. Apart from the above, he went

through the NCLT order dated 02.04.2018 in great detail, and stated

that there is a conceptual confusion in the said order, inasmuch as

Section  14(1)(b)  of  the  Code  was  not  the  subject-matter  of

consideration, in which case it would have been necessary to see

other  sections dealing with “assets”  that  pertain to the Corporate

Debtor, such as Sections 18 and 36 of the Code. If Section 14(1)(d),

on  the  other  hand,  were  to  be  seen,  it  does  not  mention  the

expression  “assets”  at  all  but  only  refers  to  “property”,  which

according to Mr. Mehta was defined extremely widely.  He argued

that, in any event, on the plain language of Section 14(1)(d), it was

not necessary for him to make out any case as to legal possession

having been handed over to him, as the expression used by Section

14(1)(d) and applied to the facts of his case is  ‘… is occupied by’.

He argued that applying the latin maxim reddendo singula singulis, it

is clear that any recovery of a property by an owner where such

property  is  ‘occupied  by’ the  Corporate  Debtor  would  clearly  fall

within Section 14(1)(d), the expression  “...or in the possession of”

going with the expression “lessor” and not “owner”. This being the

case,  he contended that  it  is  clear  that  when two expressions of



different  import  are  used  within  the  same  sub-section,  they  are

meant  to  mean different  things.  The  expression  ‘occupied’ would

have to be confined to physical occupation or use, and not to legal

possession, which is a separate concept in law. He cited a number

of authorities to buttress his arguments.

3. Mr. Dushyant Dave, learned Senior Advocate appearing on

behalf  of  MHADA,  painstakingly  took  us  through  the  various

provisions of the Maharashtra Housing and Area Development Act,

1976 (hereinafter  referred  to  as  the  “MHADA Act”).  He  relied,  in

particular,  upon  the  various  clauses  in  the  preamble  and  then

referred to Sections 4, 5, 37, 66 and 74 and relied strongly upon

Sections  76  and  79  of  the  MHADA  Act  to  argue  that  joint

development schemes that the Authorities concerned enter into with

the builders must first be with the previous approval of the Authority,

and such schemes have to be executed under the supervision of the

Authority. This being the case, according to him, there is no question

of any possession or occupation being handed over and, as a result,

Section 14(1)(d) of the Code would not apply. He also strongly relied

upon  a  recent  judgment  by  my  brother  S.  Ravindra  Bhat,  J.  in

Municipal Corporation of Greater Mumbai (MCGM) vs. Abhilash

Lal  &  Ors. (Civil  Appeal  No.  6350  of  2019),  to  buttress  his

proposition that  Section 238 of  the Code,  which contains a non-



obstante clause getting out of harm’s way other statutes, cannot be

extended beyond the provisions of the Code. He exhorted us to give

full play to the MHADA Act, and if that were done it is obvious that

any clash between the MHADA Act and the Insolvency Code would

then have to be resolved, at least on the facts of this case, in favour

of MHADA. He also referred to a Bombay High Court order dated

05.04.2018, in which it was stated that MHADA had taken symbolic

possession on 05.04.2018.

4. Mr. Basava Prabhu Patil, learned Senior Advocate appearing

on behalf of some of the homebuyers, also referred to and relied

upon the judgment of my brother S. Ravindra Bhat, J. Both Mr. Dave

and Mr. Patil referred to and relied upon a recent judgment of this

Court in Sushil Kumar Agarwal vs. Meenakshi Sadhu and Others

(2019) 2 SCC 241 in which, in the context of specific performance,

development agreements were categorized into three types, and it

was stated that where interests in property were not created by any

category, such agreements could not be specifically performed.

5. Having heard the learned senior counsel appearing for all the

parties, it is necessary to first set out some of the provisions of the

Code. Section 3(27) reads as follows:

“3.  Definitions. In  this  Code,  unless  the  context otherwise requires,—

xxx xxx xxx



(27)  “property”  includes  money,  goods,  actionable claims,  land  and  every  description  of  property situated  in  India  or  outside  India  and  every description of interest including present or future or vested  or  contingent  interest  arising  out  of,  or incidental to, property;”

Section 14 is set out as follows:

“14. Moratorium. (1) Subject to provisions of sub-sections (2) and (3), on  the  insolvency  commencement  date,  the Adjudicating  Authority  shall  by  order  declare moratorium  for  prohibiting  all  of  the  following, namely:— (a) the institution of suits or continuation of pending suits  or  proceedings  against  the  corporate  debtor including execution of any judgment, decree or order in any court of law, tribunal, arbitration panel or other authority; (b)  transferring,  encumbering,  alienating  or disposing  of  by  the  corporate  debtor  any  of  its assets  or  any  legal  right  or  beneficial  interest therein; (c) any action to foreclose, recover or enforce any security interest created by the corporate debtor in respect of its property including any action under the Securitisation  and  Reconstruction  of  Financial Assets  and  Enforcement  of  Security  Interest  Act, 2002 (54 of 2002); (d)  the  recovery  of  any  property  by  an  owner  or lessor where such property is occupied by or in the possession of the corporate debtor.

(2) The supply of essential goods or services to the corporate debtor as may be specified shall  not be terminated  or  suspended  or  interrupted  during moratorium period.

(3) The provisions of sub-section (1) shall not apply to—  (a)  such  transaction  as  may  be  notified  by  the Central  Government  in  consultation  with  any financial regulator; (b) a surety in a contract of guarantee to a corporate




(4) The order of moratorium shall have effect from the  date  of  such  order  till  the  completion  of  the corporate insolvency resolution process: Provided that where at any time during the corporate insolvency  resolution  process  period,  if  the Adjudicating Authority approves the resolution plan under  sub-section  (1)  of  section  31 or  passes an order  for  liquidation  of  corporate  debtor  under section  33,  the  moratorium  shall  cease  to  have effect from the date of such approval or liquidation order, as the case may be.”  

(emphasis supplied)

Section  18,  on  which  great  reliance  is  placed,  is  also  set  out


“18. Duties of interim resolution professional.  (1) The interim resolution professional shall perform the following duties, namely:—  (a)  collect  all  information  relating  to  the  assets, finances and operations of the corporate debtor for determining  the  financial  position of  the corporate debtor, including information relating to—  (i) business operations for the previous two years; (ii)  financial  and  operational  payments  for  the previous two years; (iii)  list  of  assets and liabilities as on the initiation date; and (iv) such other matters as may be specified;

(b) receive and collate all  the claims submitted by creditors  to  him,  pursuant  to  the  public announcement made under sections 13 and 15;

(c) constitute a committee of creditors;

(d) monitor the assets of the corporate debtor and manage its operations until a resolution professional is appointed by the committee of creditors;

(e)  file  information  collected  with  the  information



utility, if necessary; and

(f) take control and custody of any asset over which the  corporate  debtor  has  ownership  rights  as recorded  in  the  balance  sheet  of  the  corporate debtor, or with information utility or the depository of securities  or  any  other  registry  that  records  the ownership of assets including— (i)  assets  over  which  the  corporate  debtor  has ownership rights which may be located in a foreign country; (ii) assets that may or may not be in possession of the corporate debtor; (iii) tangible assets, whether movable or immovable; (iv) intangible assets including intellectual property; (v) securities including shares held in any subsidiary of  the  corporate  debtor,  financial  instruments, insurance policies; (vi) assets subject to the determination of ownership by a court or authority;

(g) to perform such other duties as may be specified by the Board.

Explanation.—For the purposes of this section, the term "assets" shall not include the following, namely: — (a) assets owned by a third party in possession of the  corporate  debtor  held  under  trust  or  under contractual arrangements including bailment; (b) assets of any Indian or foreign subsidiary of the corporate debtor; and (c)  such  other  assets  as  may  be  notified  by  the Central  Government  in  consultation  with  any financial sector regulator.”

Section  31  which  indicates  the  period  of  moratorium  is  also

important and is set out as follows:

“31.  Approval of resolution plan. (1) If the Adjudicating Authority is satisfied that the resolution  plan  as  approved  by  the  committee  of creditors under sub-section (4) of section 30 meets



the requirements as referred to in sub-section (2) of section 30, it shall by order approve the resolution plan which shall be binding on the corporate debtor and  its  employees,  members,  creditors,  including the Central Government, any State Government or any local authority to whom a debt in respect of the payment of dues arising under any law for the time being in force, such as authorities to whom statutory dues are owed, guarantors and other stakeholders involved in the resolution plan: Provided that the Adjudicating Authority shall, before passing  an  order  for  approval  of  resolution  plan under  this  sub-section,  satisfy  that  the  resolution plan has provisions for its effective implementation.

(2) Where the Adjudicating Authority is satisfied that the  resolution  plan  does  not  confirm  to  the requirements referred to in sub-section (1), it  may, by an order, reject the resolution plan.  

(3)  After  the  order  of  approval  under  sub-section (1),- (a) the moratorium order passed by the Adjudicating Authority  under  section  14  shall  cease  to  have effect; and (b)  the  resolution  professional  shall  forward  all records  relating  to  the  conduct  of  the  corporate insolvency  resolution  process  and  the  resolution plan to the Board to be recorded on its database.

(4)  The resolution applicant  shall,  pursuant  to  the resolution  plan  approved  under  sub-section  (1), obtain the necessary approval  required under  any law for the time being in force within a period of one year from the date of approval of the resolution plan by the Adjudicating Authority under sub-section (1) or within such period as provided for  in such law, whichever is later: Provided that where the resolution plan contains a provision for combination, as referred to in section 5 of  the  Competition  Act,  2002  (12  of  2003),  the resolution applicant shall obtain the approval of the Competition  Commission  of  India  under  that  Act prior to the approval of such resolution plan by the committee of creditors.”



Section 36(4) which is  also relied upon, particularly by the NCLT

judgment, is set out as follows:

“36.  Liquidation estate. (4)  The  following  shall  not  be  included  in  the liquidation estate assets and shall not be used for recovery in the liquidation:—  (a)  assets  owned  by  a  third  party  which  are  in possession of the corporate debtor, including—  (i) assets held in trust for any third party; (ii) bailment contracts; (iii) all sums due to any workman or employee from the provident fund, the pension fund and the gratuity fund; (iv)  other  contractual  arrangements  which  do  not stipulate transfer of title but only use of the assets; and (v)  such  other  assets  as  may  be  notified  by  the Central  Government  in  consultation  with  any financial sector regulator;

(b)  assets  in  security  collateral  held  by  financial services  providers  and  are  subject  to  netting  and set-off  in  multi-lateral  trading  or  clearing transactions;

(c) personal assets of any shareholder or partner of a  corporate  debtor  as  the  case  may  be  provided such assets are not held on account of avoidance transactions  that  may  be  avoided  under  this Chapter;

(d) assets of any Indian or foreign subsidiary of the corporate debtor; or

(e)  any  other  assets  as  may  be  specified  by  the Board,  including assets which could be subject  to set-off on account of mutual dealings between the corporate debtor and any creditor.”



6. The  Joint  Development  Agreement,  in  the  present  case,

makes it  clear that a license is granted to the developer (i.e. the

Corporate  Debtor)  to  enter  upon  the  land,  demolish  the  existing

structures  and  to  construct  and  erect  new  structures  and  allot

tenements.  This is  done in  the Joint  Development  Agreement  as


“1.1.9 License Agreement shall mean and include an agreement  by  which  a  license  will  be  granted  in favour of the developer to enter upon the said land, to demolish the existing structures, to construct and erect  new  structures,  to  allot  tenements  in  such constructed structures to the tenants and to do all other acts as are necessary for implementation of the project.

1.1.10 Project  shall  mean  the  building/s  to  be constructed by the developer  and handed over  to the society for housing the tenants and to MHADA in terms  of  this  agreement  but  shall  not  mean  and include the free sale buildings that the developer is entitled  to  develop  and  construct  in  terms  of  this agreement and in terms of the plan.”

“2.1.2 For  the  performance  of  the  project,  it  is expressly agreed between the parties that:

xxx xxx xxx

(xxvi)  It is agreed that the license will be granted to the Developer as per the requirement of the project. After  completion  of  the  development,  the beneficiaries housing societies will have to enter into lease deed with MHADA.

(xxvii)  The  Developer  shall  abide  the  terms  of indemnity bond regarding the responsibility and risk for implementation, execution and completion of the project and specification and quality of work to be



executed  which  is  submitted  to  the  VP  and CEO/MHADA.

xxx xxx xxx

(xxxix)   For  the  purpose  of  rehabilitation  of  the tenants  and  implementing  the  project,  MHADA hereby  grants  the  license  in  the  favour  of  the Developer to enter upon the said land, to demolish the existing structures, to construct and erect new structures,  to  allot  tenements  in  such  constructed structures to the tenants and to do all other acts as are  necessary  for  implementation  of  the  project. After completion of the project by the Developer and recovery of all the dues by MHADA, MHADA shall execute  separate  lease  deeds  in  favour  of  the Society and in favour of the Developer of free sale tenements  constructed  by  the  Developer.   All  the tenements  both  Rehab  and  sale  will  have  to  be allotted on ownership basis.

xxx xxx xxx

(xlvi)  The Developer will  be permitted to use their share of 50% of the built-up area for non-residential purpose. For this purpose, additional  premium will not be charged by MHADA.”

The aforesaid provisions of the Joint Development Agreement would

show that,  at the very least,  a license is granted in favour of the

developer  to  enter  upon the land to demolish existing structures,

construct and erect new structures, and allot to erstwhile tenants,

tenements in such constructed structures in three categories – (1)

the earlier tenants/licensees of structures that were demolished; (2)

tenements to be allotted free of  cost  to MHADA; and (3) what is

referred to as “free sale component” which the developers then sell



and exploit to recover or recoup cost and make profit. It is wholly

unnecessary  for  us  to  refer  to  any  other  clauses  of  the  Joint

Development Agreement. It is also not necessary for the purpose of

this case to state as to whether an interest in property is or is not

created by the said Joint Development Agreement.

7. A bare reading of Section 14(1)(d) of the Code would make it

clear that it  does not deal with any of the assets or legal right or

beneficial interest in such assets of the corporate debtor. For this

reason, any reference to Sections 18 and 36, as was made by the

NCLT,  becomes  wholly  unnecessary  in  deciding  the  scope  of

Section 14(1)(d), which stands on a separate footing. Under Section

14(1)(d) what is referred to is the “recovery of any property”. The

‘property’  in  this  case  consists  of  land,  ad-measuring  47  acres,

together  with  structures  thereon  that  had  to  be  demolished.

‘Recovery’  would  necessarily  go  with  what  was  parted  by  the

corporate debtor, and for this one has to go to the next expression

contained in the said sub-section.

8. One thing is clear that “owner or lessor” qua “property” is then

to be read with the expression “occupied or in the possession of”.

One manner of reading this clause is to state that whether recovery

is  sought  by  an  owner  or  lessor,  the  property  should  either  be

occupied by or be in the possession of the corporate debtor. The



difficulty with this interpretation is that a “lessor” would not normally

seek recovery of property “occupied by” a tenant – having leased

the property, a transfer of property has taken place in favour of a

tenant, “possession” of which would then have to be recovered. This

is where the latin maxim reddendo singula singulis comes in. In an

earlier judgment of this Court reported in  The Member, Board of

Revenue vs. Arthur Paul Benthall [1955] 2 SCR 842, this Court

dealt with two different expressions used in Sections 5 and 6 of the

Indian Stamp Act, 1899, and held:

“We are  unable  to  accept  the  contention  that  the word “matter” in Section 5 was intended to convey the  same  meaning  as  the  word  “description”  in Section  6.  In  its  popular  sense,  the  expression “distinct matters” would connote something different from distinct “categories”. Two transactions might be of the same description, but all the same, they might be distinct. If A sells Black-acre to X and mortgages White-acre to Y, the transactions fall under different categories,  and they are also distinct  matters.  But if A mortgages  Black-acre  to X and  mortgages White-acre to Y, the two transactions fall under the same category, but they would certainly be distinct matters. If  the intention of the legislature was that the expression ‘distinct matters’ in Section 5 should be understood not in its popular sense but narrowly as  meaning  different  categories  in  the  Schedule, nothing  would  have  been  easier  than  to  say  so. When two words of  different  import  are used in a statute  in  two consecutive  provisions,  it  would  be difficult to maintain that they are used in the same sense,  and  the  conclusion  must  follow  that  the expression  “distinct  matters”  in  Section  5  and “descriptions”  in  Section  6  have  different connotations.”

(at page 846)



9. In  Koteswar Vittal Kamath vs. K. Rangappa Baliga & Co

(1969) 1 SCC 255, this Court  had before it  the proviso to Article

304(b)  of  the Constitution of  India.  This proviso is  set  out  herein


“Provided  that  no  Bill  or  amendment  for  the purposes of clause (b) shall be introduced or moved in  the  Legislature  of  a  State  without  the  previous sanction of the President.”

The expression “no Bill or amendment” was read distributively with

the expression “shall be introduced or moved in the Legislature of a

State”, it being clear that a bill is “introduced” and an amendment

“moved”, in the following paragraphs:

“13. The High Court, in this connection, relied on two earlier  decisions  of  the  same  court in George v. State of  Travancore-Cochin,  AIR 1954 Tra-Co  34  and  State v. Philipose  Philip,  AIR  1954 Tra-Co 257. In fact, the High Court, in the present case,  expressed  its  decision  in  almost  the  same language  as  was  contained  in  the  case of George v. State.  In  the  second  case of State v. Philipose  Philip,  this  aspect  was  not clearly  discussed.  The  point,  however,  was considered in  detail  by  a  Full  Bench of  that  High Court  in Ulahannan Mathai v. State,  AIR 1955 Tra- Co 82.  The High Court  interpreted the expression “No  Bill  or  amendment  shall  be  introduced  or moved”  in  the  proviso  as  requiring  that  the  Bill should neither be introduced nor moved without the prior  sanction  of  the  President,  and,  since  in  the case  of  Act  5  of  1950,  the  Bill  was  moved  for consideration,  without  the  prior  sanction  of  the President,  on  23rd  March,  1950,  after  the Constitution had  come into  force,  there  had  been non-compliance with the proviso. The court rejected



the contention put  forward before  it  that  what  the proviso  really  stipulates  is  that  no  Bill  “shall  be introduced”  or  “amendment  moved”  in  the Legislature of a State without the previous sanction of the President. That argument was advanced on the basis of the maxim  “reddendo singula singulis” which,  according to Black's  Interpretation of  Laws, means:  

“Where a sentence in a statute contains several antecedents and several consequences, they are to be read distributively, that is to say, each phrase or expression  is  to  be  referred  to  its  appropriate object.”

14. The court based its decision on the view that, if the interpretation urged before  it  was accepted,  it would be possible to introduce a Bill which required no Presidential sanction, get it amended by a Select Committee in such a way as to make it require the Presidential  sanction  in  case  it  was  originally introduced in  the amended form and then pass it into law, and thus escape the necessity for the prior Presidential sanction provided by Article 304 of the Constitution. It was held that there can be no doubt that such a result could never have been intended by the makers of the Constitution. In our opinion, the High Court did not correctly appreciate the position. The language of the proviso cannot be interpreted in the  manner  accepted  by  the  High  Court  without doing violence to the Rules of construction. If both the words “introduced” or “moved” are held to refer to  the  Bill,  it  must  necessarily  be  held  that  both those words will also refer to the word “amendment”. On  the  face  of  it,  there  can  be  no  question  of introducing an amendment. Amendments are moved and then, if accepted by the House, incorporated in the  Bill  before  it  is  passed.  There  is  further  an indication in the Constitution itself  that wherever a reference is made to a Bill, the only step envisaged is introduction of the Bill.  There is no reference to such a step as a Bill being moved. The articles, of which notice may be taken in this connection, are Articles  109,  114,  117,  198 and 207.  In  all  these



articles, whatever prohibition is laid down relates to the introduction of a Bill in the Legislature. There is no reference at any stage to a Bill being moved in a House. The language thus used in the Constitution clearly points to the interpretation that, even in the proviso to Article 304, the word “introduced” refers to the  Bill, while  the  word “moved” refers  to  the amendment.”

10. Likewise,  in  Kailash  Nath  Agarwal  and  Others  v.

Pradeshiya Industrial & Investment Corporation of U.P. Ltd. and

Another (2003) 4 SCC 305, this Court referred to Section 22(1) of

the Sick Industries Companies (Special Provisions) Amendment Act,

1994 and applied the aforesaid latin maxim to the words “suit” and

“proceeding” as follows:

“20. There  is  an  apparent  distinction  between  the expressions “proceeding” and “suit” used in Section 22(1). While it is true that two different words may be used in  the same statute  to  convey the same meaning, that is the exception rather than the rule. The general rule is that when two different words are used by the same statute, prima facie one has to construe these different words as carrying different meanings. In Kanhaiyalal Vishindas Gidwani (1993) 2  SCC  144,  this  Court  found  that  the  words “subscribed”  and  “signed”  had  been  used  in  the Representation  of  the  People  Act,  1951 interchangeably and, therefore,  in that  context  the Court  came  to  the  conclusion  that  when  the legislature  used  the  word  “subscribed”  it  did  not intend  anything  more  than  “signing”.  The  words “suit”  and  “proceeding”  have  not  been  used interchangeably  in  SICA.  Therefore,  the  reasons which  persuaded  this  Court  to  give  the  same meaning to two different words in a statute cannot be applied here.

xxx xxx xxx



26. Apart from the semantic difference between the words “suit” and “proceeding” there is the absence of expansive words “or the like” which appear after the expression “proceedings”, after the word “suit”. The  exclusion  of  such  “omnibus  expression”  after the  word  “suit”  must  be  given  some  weight  in interpreting  the  word.  As  held  by  this  Court in LIC v. Escorts Ltd. (2001) 1 SCC 78: (SCC p. 313, para 63)

“The  distinction  made  by  Parliament  … in  the several  provisions  of  the  same  Act  cannot  be ignored or strained to be explained away by us. That is not the way to interpret statutes. The proper way is  to  give  due  weight  to  the  use  as  well  as  the omission  to  use  the  qualifying  words  in  different provisions of the Act. The significance of the use of the qualifying word in one provision and its non-use in another provision may not be disregarded.”

27. Since  the  legislature  has  expressly  chosen  to make a distinction between the suits for recovery of the  money  and  enforcement  of  guarantees  and proceedings for the recovery of money, that must be given effect to.

28. Furthermore,  Parliament  must  be  taken  to  be aware of the decision in Maharashtra Tubes [Arising out of SLPs (C) Nos. 21370 and 21371 of 2002] and the fact that the word “proceeding” used in Section 22(1)  had  been  widely  construed  to  include proceedings  for  recovery  of  dues  by  the  State Financial  Corporation  as  arrears  of  land  revenue. The  deliberate  choice  of  the  word  “suit”  in  the circumstances  would  indicate  that  Parliament intended  to  limit  the  ambit  of  the  amendment introduced to particular  modes for  the recovery of money or enforcement of guarantees.”

11. Regard being had to the aforesaid authorities, it is clear that

when recovery of property is to be made by an owner under Section



14(1)(d), such recovery would be of property that is “occupied by” a

corporate debtor.

12. The  expression  “occupied”  has  been  the  subject-matter  of

decision in a number of judgments in different contexts.  Thus, in

Industrial Supplies Pvt. Ltd. and Another vs. Union of India and

Others (1980) 4 SCC 341, this Court was faced with the following


“2. The  appeals  raise  a  question  of  far-reaching importance namely, whether a raising contractor of a coal mine is an owner within the meaning of sub- section (1) of Section 4 of the Coking Coal Mines (Nationalisation) Act, 1972 (hereinafter referred to as the  “Nationalisation  Act”);  and  if  so,  whether  the fixed assets like machinery, plants, equipment and other  properties  installed  or  brought  in  by  such a raising contractor  vest  in the Central  Government. They also give rise to a subsidiary question, namely, whether subsidy receivable from the erstwhile Coal Board  established  under  Section  4  of  the  Coal Mines (Conservation, Safety and Development) Act, 1952 up to the specified date, from a fund known as Conservation  and  Safety  Fund,  by  such  raising contractor  prior  to  the  appointed  day,  can  be realised by the Central Government by virtue of their powers under sub-section (3) of Section 22 of the Nationalisation  Act,  to  the  exclusion  of  all  other persons including such contractor and applied under sub-section (4) of Section 22 towards the discharge of the liabilities of the coking coal mine, which could not be discharged by the appointed day.”

In answering the aforesaid question, this Court distinguished Chief

Inspector of Mines vs. Lala Karam Chand Thapar (1962) 1 SCR

9 in the context of raising contracts of coal in paragraphs 18 and 19

of  the  judgment;  and  such  raising  agreements  by  registered



instruments being held not to amount to a lease, were held to be

licenses  coupled  with  a  grant.  This  being  the  case,  a  raising

contractor being in possession on behalf of an owner of property, or

a lessee of a mine was held to be an “occupier” within the meaning

of Section 2(1) of the Mines Act, 1952. In so holding, this Court went

into  various  dictionary  meanings  of  the  word  “occupier”  and

“occupation” and held as follows:

“19. … These observations, if we may say so, with great respect,  are  rather  widely  stated.  They  are indeed susceptible of a construction that  a raising contractor  being  in  possession  on  behalf  of  a proprietor or the lessee of a mine in possession is not an “occupier” within the meaning of Section 3(n) of the Nationalisation Act read with Section 2(1) of the Mines Act, 1952. We are quite sure that that was not  the  intention  of  the  legislature.  There  is  no reason  why  the  word  “occupier”  should  not  be understood to have been used in its usual sense, according to its plain meaning. In common parlance, an “occupier” is one who “takes” or (more usually) “holds”  possession: Shorter  oxford  dictionary,  3rd Edn., Vol. 2, p. 1433. In the legal sense, an occupier is  a  person  in  actual  occupation.  The  petitioners being raising contractors were, under the terms of the agreement dated February 7, 1969 entitled to, and  in  fact  in  actual  physical  possession  and enjoyment  of  the  colliery  and  were,  therefore,  an occupier  thereof.  That  being  so,  the  petitioners being in possession, in their own right, by virtue of the  substantial  rights  acquired  by  them under  the agreement,  were  not  in  possession  on  behalf  of somebody else and, therefore, the decision in Lala Karamchand Thapar case [(1962) 1 SCR 9] cannot apply.”

13. Likewise,  in  Dunlop  India  Limited  vs.  A.A.  Rahna  and

Another (2011) 5 SCC 778, this Court was concerned with Section



11(4)(v) of the Kerala Buildings (Lease and Rent Control) Act, 1965

which was set out in paragraph 19 of the judgment as follows:

“(v)  if  the  tenant  ceases  to  occupy  the  building continuously  for  six  months  without  reasonable cause.”

Coming to the word “occupy” in the said section,  this Court  then


“21. The word “occupy” used in Section 11(4)(v) is not synonymous with legal possession in technical sense. It means actual possession of the tenanted building or use thereof for the purpose for which it is let  out.  If  the  building  is  let  out  for  residential purpose and the tenant is shown to be continuously absent  from the building for  six months,  the court may  presume  that  he  has  ceased  to  occupy  the building or abandoned it. If the building is let out for business  or  commercial  purpose,  complete cessation of  the business/commercial  activity  may give  rise  to  a  presumption  that  the  tenant  has ceased to occupy the premises. In either case, legal possession  of  the  building  by  the  tenant  will,  by itself,  be  not  sufficient  for  refusing  an  order  of eviction unless the tenant proves that there was a reasonable cause for his having ceased to occupy the building.

xxx xxx xxx

25. The  Court  highlighted  the  distinction  between the terms “possession” and “occupy” in the context of  rent  control  legislation  in  the  following  words: (Ram Dass case (2004) 3 SCC 684, SCC pp. 687- 88, para 7)

“7.  The terms ‘possession’ and ‘occupy’ are  in common parlance used interchangeably.  However, in law, possession over a property may amount to holding  it  as  an  owner  but  to  occupy  is  to  keep possession of by being present in it. The rent control legislations  are  the  outcome  of  paucity  of



accommodations.  Most  of  the  rent  control legislations, in force in different States, expect the tenant to occupy the tenancy premises. If he himself ceases  to  occupy  and  parts  with  possession  in favour  of  someone  else,  it  provides  a  ground  for eviction. Similarly, some legislations provide it as a ground of eviction if  the tenant has just ceased to occupy the tenancy premises though he may have continued to retain possession thereof. The scheme of  the Haryana Act  is  also to insist  on the tenant remaining  in  occupation  of  the  premises. Consistently  with  what  has  been  mutually  agreed upon, the tenant is expected to make useful use of the  property  and  subject  the  tenancy  premises to any permissible and useful activity by actually being there.  To  the  landlord's  plea  of  the  tenant  having ceased to occupy the premises it is no answer that the  tenant  has  a  right  to  possess  the  tenancy premises  and  he  has  continued  in  juridical possession  thereof.  The  Act  protects  the  tenants from eviction and enacts specifically the grounds on the availability whereof the tenant may be directed to be evicted.  It  is  for  the landlord to make out a ground for eviction. The burden of proof lies on him. However, the onus keeps shifting. Once the landlord has been able to show that the tenancy premises were not being used for the purpose for which they were let out and the tenant has discontinued such activities  in  the  tenancy  premises  as  would  have required the tenant's actually being in the premises, the ground for eviction is made out. The availability of  a  reasonable  cause  for  ceasing  to  occupy  the premises would obviously be within the knowledge and, at times, within the exclusive knowledge of the tenant. Once  the  premises  have  been  shown  by evidence to be not in occupation of the tenant, the pleading  of  the  landlord  that  such  non-user  is without reasonable cause has the effect of putting the  tenant  on  notice  to  plead  and  prove  the availability  of  reasonable  cause  for  ceasing  to occupy the tenancy premises.”

xxx xxx xxx

29. In  Ananthasubramania  Iyer  v.  Sarada  Amma



1978  KLT  338,  the  learned  Single  Judge  of  the Kerala High Court held: (KLT pp. 339-40, para 3)

The  physical  absence  of  the  tenant  from  the building  for  more  than  six  months  would  raise  a presumption  that  he  had  ceased  to  occupy  the building and that  he had abandoned it  and that  it was for the tenant to dislodge the presumption and establish  that  he  had  the  intention  to  continue  to occupy the tenanted premises.

30. The word “occupy” appearing in Section 11(4)(v) of the 1965 Act has been interpreted by the Kerala High Court  in a large number of  cases.  In Mathai Antony v. Abraham (2004)  3  KLT 169,  the Division Bench  of  the  High  Court  referred  to  several judgments  including the one of  this  Court  in Ram Dass v. Davinder (2004) 3 SCC 684 and observed:

“4.  … The  word  ‘occupy’  occurring  in  Section 11(4)(v)  has  got  different  meaning  in  different context.  The meaning  of  the  word ‘occupy’ in  the context of Section 11(4)(v) has to be understood in the  light  of  the  object  and  purpose  of  the  Rent Control  Act  in mind. The rent  control  legislation is intended  to  give  protection  to  the  tenant,  so  that there will  not  be interference with the user  of  the tenanted  premises  during  the  currency  of  the tenancy. The landlord cannot disturb the possession and enjoyment of the tenanted premises. Legislature has  guardedly  used  the  expression  ‘occupy’  in Section 11(4)(v) instead of ‘possession’. Occupy in certain  context  indicates  mere  physical  presence, but  in  other  context  actual  enjoyment.  Occupation includes  possession  as  its  primary  element,  and also  includes  ‘enjoyment’.  The  word  ‘occupy’ sometimes  indicates  legal  possession  in  the technical  sense;  at  other  times  mere  physical presence.  We  have  to  examine  the  question whether  mere  ‘physical  possession’  would  satisfy the  word  ‘occupy’  within  the  meaning  of  Section 11(4)(v)  of  the  Act.  In  our  view  mere  physical possession  of  premises  would  not  satisfy  the meaning of ‘occupation’ under Section 11(4)(v). The word  ‘possession’  means  holding  of  such



possession,  animus possidendi,  which means,  the intention  to  exclude  other  persons.  The  word ‘occupy’ has to be given a meaning so as to hold that  the tenant is actually using the premises and not  mere  physical  presence  or  possession.  A learned  Single  Judge  of  this  Court in Abbas v. Sankaran  Namboodiri (1993)  1  KLT 76 took the view that the word ‘occupation’ is used to denote  the  tenant's  actual  physical  use  of  the building either by himself  or through his agents or employees.  The  Division  Bench  of  this  Court  of which  one  of  us  is  a  party  (Radhakrishnan,  J.), in Rajagopalan v. Gopalan (2004)  1  KLT  (SN)  54 interpreting  Section  11(4)(v)  took  the  view  that occupation in  the context  of  Section 11(4)  means only  physical  occupation,  which  requires  further explanation.  Occupation  in  the  context  of  Section 11(4)(v)  means  actual  user.  If  the  landlord  could establish that in a given case even if the tenant is in physical possession of the premises, the premises is not being used, that is a good ground for eviction under Section 11(4)(v) of the Act. Section 11(4) uses the words ‘put the landlord in possession’ and not ‘occupation’,  but  Section  11(4)(v)  uses  the  words ‘the tenant ceases to occupy’. In Section 11(4)(v) in the case of landlord the emphasis is on ‘possession’ but  in  the  case  of  tenant  the  emphasis  is  on ‘occupation’.  The  word  ‘occupy’  has  a  distinct meaning so far as the Rent Act is concerned when pertains to tenant, that is, possession with user.”

14. A Full Bench judgment of the Punjab and Haryana High Court

reported in Ude Bhan and Others vs. Kapoor Chand and Others

AIR  1967  P&H  53  (FB)  is  also  instructive.  Paragraph  1  of  the

judgment speaks of three questions referred to the Full Bench.  We

are directly concerned with question 2 which is set out by us herein


“(2) If any building attached to the main residential house  belonging  to  and  occupied  by  a  non-



agriculturist  judgment-debtor is let out to a tenant, will  that  portion  be  considered  to  be  in  his occupation  within  the  meaning  of  the  above provision?”

In  answering  this  question,  the  Full  Bench  went  into  various

authorities  and  dictionaries  as  to  what  the  expression “occupied”

would mean, as follows:

“20. The  other  term  about  which  considerable argument  has  been  addressed  to  the  Bench  is “occupied by him” and it has even been suggested that  the  property  which  is  let  by  the  owner  to  a tenant, though not in the former's actual occupation, is in his constructive occupation just as it  may be said  that  he  is  possessing  it  though  indirectly through  his  tenant.  Reference  was  made  to  the connotation of the term “occupied” as given at pages 83 and 84 of Volume 67 of Corpus Juris Secundum.  

“The  term  has  many  meanings;  in  legal acceptation the term implies  use  and possession, and it has been said that it implies actual possession and  not  constructive  possession,  but  it  also  has been held that “occupied” does not always require an actual occupancy, but it may sometimes permit a constructive  occupancy.  It  is  defined  as  meaning held  in  possession.  “Occupied”  is  an  appropriate word to use for  the purpose of  identifying land in actual possession, and when applied to a building, implies  a  substantial  and  practical  use  of  the building for the purpose for which it is designed”.  

21. I do not consider that the above quotation with its many meanings, some of them self-contradictory, is of any real help, and it is clear that the meaning of the  word  varies  according  to  the  context  of  the statute in which it is used.

22. Mr.  S.L.  Puri,  learned counsel  for  the decree- holder  in  the  Letters  Patent  Appeal,  in  his  turn referred to the meaning of the word “occupy” in the Webster's  Third  New  International  Dictionary and



some of the meanings as given there are, to fill up a place or extent, to take up residence, to settle in, to reside in as an owner or tenant. This indicates that the  term  “occupy”  in  relation  to  a  house  has  an element  of  physical  and actual  occupation though not necessarily of every cubic inch of the premises which would, of course, be impossible at any given time.

23. Reference was also made by Mr. Roop Chand to the meaning of  the term “occupation”  as  given at page 15 of  Volume 14 of  the  Halsbury's  Laws of England (Third  Edition).  It  was  stated  that  “an occupier is one who actually exercises the rights of an  owner  in  possession.  The  primary  element  of occupation is possession, but it includes something more,  for  mere legal  possession cannot constitute an occupation. The owner of a vacant house is in possession,  though  not  in  occupation;  but  if  he furnishes  the  house  and  keeps  it  ready  for habitation,  he  is  an  occupier,  though  he  may  not have resided in it for a considerable time before the qualifying date”.  

xxx xxx xxx

26. The  term  “occupy”  has  been  interpreted  in numerous cases of the Punjab and other Courts in India and it would be tedious as well as unnecessary to refer to all  of them. On behalf of the judgment- debtor  reference  has  been  made  to  the interpretation of the terms “occupation” and “occupy” in  clause  (3)  of  the  Mysore  House  Rent  and Accommodation  Control  Order  in Ratilal Bros. v. The  Government  of  Mysore  and  another, AIR 1951 Mysore 66 and section 11(3) of the Bihar Buildings  (Lease,  Rent  and  Eviction)  Control  Act, 1947,  in Balmukand  Khatry v. Hari  Narain  and others,  AIR  1949  Patna  31  and  on  behalf  of  the decree-holders reliance was placed on the definition of  similar  terms  in  section  7(3)  of  the  Madras Buildings  (Lease  and  Rent  Control)  Act,1946,  as given  in Dr.Mohammad  Ibrahim v. Syed  Ahmed Khan and another, AIR 1950 Mad 556 and in sub-



section (5) of section 15 of the East Punjab Urban Rent  Restriction  Act,  1949,  as  made in Shakuntla Bawa v. Ram Parkash and others, ILR (1963) 1 Punj 827. These interpretations depend on the particular context  in  which  the  terms  occur  in  the  relevant statute but what has been observed in most of these cases  is  that  the  term  “occupation”  is  of  a  wider import  than  the  term  possession  and  means something more than legal possession, which may be  either  actual  or  constructive.  More  helpful  are some  cases  which  arose  in  the  Punjab  under section 60(1)(c) or (ccc) of the Code.”

15. The conspectus of the aforesaid judgments would show that

the expression “occupied by” would mean or be synonymous with

being in actual physical possession of or being actually used by, in

contra-distinction  to  the  expression  “possession”,  which  would

connote possession being either constructive or actual and which, in

turn, would include legally being in possession, though factually not

being  in  physical  possession.  Since  it  is  clear  that  the  Joint

Development  Agreement  read  with  the  Deed  of  Modification  has

granted a license to the developer (Corporate Debtor) to enter upon

the property, with a view to do all the things that are mentioned in it,

there can be no gain saying that after such entry, the property would

be “occupied by” the developer.  Indeed, this becomes clear from

the termination notice dated 12.01.2018, issued by MHADA to the

developer, in which it is stated:

“35. This is therefore to inform you that on the expiry of 30 days from the date of receipt of this notice, the Joint  Development  Agreement  dated  10.04.2008



and  Deed  of  Confirmation  and  Modification  dated 03.11.2011  and  Letter  dated  18.01.2014  stands terminated and you will not be allowed to enter the property  and  your  authority/license  to  enter  the property or remain thereupon is terminated. MHADA thereupon will not allow you to do anything on or in relation  to  the  property  and  MHADA  shall  take possession of all the structures standing at whatever stage  they  are  situated  at  Goregaon  (West)  and bearing CTS No …”

It  now remains for  us to deal  with some of  the provisions of  the

MHADA Act as well as some of the judgments cited on behalf of the

respondents. MHADA Act, as its preamble states, is an Act to unify,

consolidate and amend the laws relating to housing, repairing and

reconstructing dangerous buildings and carrying out  improvement

works in slum areas. By Section 4 of the Act, the Authority, i.e. the

MHADA, is to be a corporate body, and is deemed to be a local

authority for the purposes of the Act. By Section 5 the Rent Act, or

any  corresponding  laws  are  not  to  apply.  By  Section  66,  the

Competent Authority is given power to evict persons from premises

under certain circumstances. Sections 76 and 79, on which great

reliance was placed by Mr. Dave, are set out herein below:

“76.  Duties  relating  to  repairs  and reconstruction of  dilapidated buildings. Subject to the provisions of this Chapter, it shall be the duty of the Board –  (a) to undertake and carry out structural repairs to buildings,  in  such  order  of  priority  as  the  Board, having  regard  to  the  exigencies  of  the  case  and availability  of  resources,  considers  necessary, without  recovering any expenses thereof  from the



owners or occupiers of such buildings; (b)  to  provide  temporary  or  alternative accommodation  to  the  occupiers  of  any  such building, when repairs thereto are undertaken, or a building collapses; (c)  to  undertake,  from  time  to  time,  the  work  of ordinary  and  tenantable  repairs  in  respect  of  all premises placed at the disposal of the Board; (d)  to  move the  State  Government  to  acquire  old and  dilapidated  buildings  and  which  are,  in  the opinion  of  the  Board,  beyond  repairs;  and  to reconstruct  or  to  get  reconstructed  new  buildings thereon for the purpose of housing as  many occupiers of  those properties as possible,  and for providing  alternative  accommodation  to  other affected occupiers;

79.  Power  of  Board  to  undertake  building repairs,  building  reconstruction  and  occupiers housing and rehabilitation schemes. (1) The Authority may, on such terms and conditions as it may think fit to impose, entrust to the Board the framing  and  execution  of  schemes  for  building repairs  or  for  reconstruction  of  buildings  or  for housing and rehabilitation of, dishoused occupiers, whether provided by this Act or not, and the Board shall  thereupon  undertake  the  framing  and execution  of  such  schemes  as  if  it  had  been provided for by this Act. (2) The Board may, on such terms and conditions as may be agreed upon and with the previous approval of the Authority- (a) hand  over  the  execution  under  its  own supervision of any building  repairs  scheme, building  reconstruction  scheme,  or  dishoused occupier’s  housing  scheme  to  a  Municipal Corporation or  to a co-operative society or  to any other  agency  recognized  for  the  purpose  by  the Board, as it may deem necessary, and (b) transfer by sale, exchange or otherwise in any manner  whatsoever  any  new building  constructed on any land acquired under this Chapter to any co- operative society, if it is formed by all the occupiers, or  to  apartment  owners  for  the  purposes  of  the Maharashtra  Apartment  Ownership  Act,  1970  (the



apartment owners being all such occupiers).”

16. There  is  no  doubt  whatsoever  that  important  functions

relating to repairs and re-construction of  dilapidated buildings are

given to MHADA. Equally, there is no doubt that in a given set of

circumstances,  the Board may,  on such terms and conditions as

may  be  agreed  upon,  and  with  the  previous  approval  of  the

Authority, handover execution of any housing scheme under its own

supervision.  However,  when  it  comes  to  any  clash  between  the

MHADA Act and the Insolvency Code, on the plain terms of Section

238 of the Insolvency Code, the Code must prevail. This is for the

very good reason that when a moratorium is spoken of by Section

14 of the Code, the idea is that, to alleviate corporate sickness, a

statutory status quo is pronounced under Section 14 the moment a

petition  is  admitted  under  Section  7  of  the  Code,  so  that  the

insolvency resolution process may proceed unhindered by any of

the obstacles that would otherwise be caused and that are dealt with

by Section 14.  The statutory freeze that  has thus been made is,

unlike its predecessor in the SICA, 1985 only a limited one, which is

expressly  limited  by  Section  31(3)  of  the  Code,  to  the  date  of

admission  of  an  insolvency  petition  up  to  the  date  that  the

Adjudicating Authority either allows a resolution plan to come into

effect or states that the corporate debtor must go into the liquidation.



For this temporary period, at least, all the things referred to under

Section 14 must be strictly observed so that the corporate debtor

may finally be put back on its feet albeit with a new management.

17. My  learned  brother  S.  Ravindra  Bhat,  J.’s  judgment  in

Municipal  Corporation  of  Greater  Mumbai (supra),  which  has

been strongly relied upon by Mr. Dave and Mr. Patil, dealt with an

entirely different fact situation, as is clear from paragraphs 32 and

33 of the said judgment, which are set out herein below:

“32. A cumulative reading of the stipulations reveals that  the  contract/agreement  contemplates  that  the lease deed was to be executed after the completion of  the  project.  The  contract  reveals  that  (a)  the project period was for 60 months starting from the date excluding the monsoon period; (b) by Clauses 5 and 17, SevenHills could mortgage the property for securing advances from financial institutions for the  construction  of  the  project  and  thereafter towards  its  working.  Such  mortgage/charge  or interest was subject to approval by MCGM. In the event  the  contract  was  to  be  terminated,  it  was agreed  that  MCGM  would  not  in  any  manner  be liable  towards  the  mortgaged  amount  and  all  its rights and ownership would continue to vest in it free from encumbrances (Clause 17).

33. The show cause notice in this case preceded admission of  the insolvency resolution process.  In view  of  the  clear  conditions  stipulated  in  the contract,  MCGM  reserved  all  its  rights  and  its properties could not have therefore, in any manner, been affected by the resolution plan. Equally in the opinion of this Court, the adjudicating authority could not  have  approved  the  plan  which  implicates  the assets  of  MCGM especially  when  SevenHills  had not fulfilled its obligations under the contract.”



18. The  matter  had  come  to  this  Court  after  the  Adjudicating

Authority  had approved of  a certain resolution plan,  unlike in  the

facts of the present case, and what was clear, on the facts of that

case, was that a show cause notice of the Municipal Corporation,

which  preceded  admission  of  the  insolvency  resolution  process,

made it clear that assets of MCGM could not possibly be subsumed

within a resolution plan without its approval/permission. It was in this

context that this Court, in para 47 of the said judgment, stated that

Section 238 of the Code cannot be read as overriding the MCGM’s

right  -  indeed  its  public  duty  -  to  control  and  regulate  how  its

properties are to be dealt with. “Properties” was referred to in this

judgment as referring to assets of the corporate debtor. We have

seen how, in the facts of this case, we are not concerned with the

assets of the corporate debtor, least of all  the assets of MHADA.

The limited question before us is as to whether Section 14(1)(d) of

the Code will apply to statutorily freeze ‘occupation’ that may have

been handed over under a Joint Development Agreement.

19. Likewise,  the  recent  judgment  Sushil  Kumar  Agarwal

(supra) deals with specific performance and whether a Development

Agreement may be specifically performed. The ratio of that judgment

appears  to  be  that  where  Development  Agreements  create  an

interest  in  property,  they  may  be  specifically  performed,  but  not



otherwise.  As  we have  pointed  out  herein  above,  it  is  clear  that

Section  14(1)(d)  of  the  Insolvency  &  Bankruptcy  Code,  when  it

speaks  about  recovery  of  property  “occupied”,  does  not  refer  to

rights  or  interests  created  in  property  but  only  actual  physical

occupation of  the property.  For this reason also,  this  judgment is

wholly distinguishable.

20. Regard being had to the above, we allow the appeal and set

aside the impugned order of the NCLAT. Considering that this matter

has been pending for some time, we direct the NCLT to dispose of

the resolution professional’s application (I.A. No.21433/2018) within

a period of six weeks from today.

…………………..………………J. (R. F. Nariman)

……………..……………………J. (S. Ravindra Bhat)

……………..……………………J.           (V. Ramasubramanian)

New Delhi. 19th February, 2020.