Commission rejects realtor's plea for staying execution proceedings

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Chandigarh, April 8

The State Consumer Disputes Redressal Commission has dismissed an application filed by Gurpreet Singh Sidhu, Managing Director of Emerging India Housing Corporation Private Limited, for staying proceedings in execution applications on the ground that a petition before the National Company Law Tribunal (NCLT), Chandigarh, was filed on March 21, 2023.

Sidhu said while acting as the Managing Director of Emerging India Housing Corporation Private Limited, he, in his individual capacity, stood personal guarantor to a financial debt availed by corporate debtor – M/s Emerin Telecom Private Limited from financial creditor Punjab National Bank. The loan became Non-Performing Asset (NPA) and a notice under Section 13 (2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFASI) Act, 2002, was issued to him claiming an amount of Rs 2,04,73,652 as on February 26, 2018.

The financial debt was guaranteed by him, but it had not been paid either by the corporate debtor (M/s Emerin Telecom Private Limited) or by him and as such, he had filed the petition under Section 94 read with Section 96 of the Code before the NCLT, under Part III, Section 79 (1) of the Code.

He said immediately on filing application under Section 94 of the Code before the NCLT, the interim moratorium comes into operation under the provisions of Section 96 of the Code and the said interim moratorium commences on the date when such application had been filed.

He said no proceedings could be initiated against the applicant, and the provisions of Code should have effect upon all laws in force in India under the provisions of Section 238 of the Code.

The counsels for the complainants opposed the application. They argued that there was ample evidence that the applicant had disposed of huge properties and earned crores of rupees in the past three years, but he kept his actual income concealed.

They argued that M/s Emerin Telecom Private Limited was not a party in these cases. Therefore, any application filed against corporate debtor – M/s Emerin – does not impact the proceedings pending against the applicant before this Commission.

After hearing the arguments, the commission consisting of Justice Raj Shekhar Atri, president, and Rajesh K Arya, member, dismissed the application. The commission said Emerging India Housing Corporation Private Limited was not a corporate debtor before the NCLT. Even M/s Emerin, which was a corporate debtor before the NCLT, was not a party in any of the consumer complaints pending before this Commission. Consequently, it is held that no case was made out to stay the proceedings against the judgment debtors before this Commission and we are of the opinion that all these applications are not maintainable and the same have been filed with malafide intention and ulterior motive to delay the proceedings and are dismissed with cost of Rs 1,000 each, which should be paid to the complainants/decree holders, in each case.