Kh Khan vs Art Constructions Private Limited

Headnote AI-drafted · Editorially reviewed

These two appeals were filed by the same appellants challenging a common order dated 30.04.2024 passed by the Adjudicating Authority (National Company Law Tribunal), New Delhi, Court-III. The first appeal (No. 1116 of 2024) challenged the order allowing an intervention application filed by M/s. Art Constructions Pvt. Ltd., the Successful Resolution Applicant, while the second appeal (No. 1117 of 2024) challenged the disposal of IA No. 4648 of 2020 filed by the appellants. Both appeals arose from a Corporate Insolvency Resolution Process initiated in CP No. I.B.-1083(PB)/2018.

The appellants, as landowners of 36 acres situated in Kengeri Village, Bangalore, had entered into a Collaboration Agreement dated 05.07.2008 with M/s. Era Landmarks (India) Ltd. for development of their land. Disputes arose when the developer failed to discharge obligations, leading to termination notices in 2012, arbitration proceedings before a Sole Arbitrator appointed by the Karnataka High Court, and subsequent litigation. The developer's rights had been assigned to its subsidiary Parinda Buildcon Private Limited, further complicating the resolution proceedings.

The NCLAT heard both appeals together and decided them by a common judgment, examining the rights of the landowners vis-à-vis the insolvency resolution process, the validity of the collaboration and assignment agreements, and the role of the Successful Resolution Applicant, Art Constructions Pvt. Ltd., in the context of the Corporate Insolvency Resolution Process of the corporate debtor.

Catchwords: Insolvency and Bankruptcy Code Corporate Insolvency Resolution Process landowner rights collaboration agreement assignment agreement successful resolution applicant intervention application arbitration NCLT NCLAT