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MumbaiIn a rare development, the promoters of the realty developer Rashmi Housing, while the company was still undergoing the Corporate Insolvency Resolution Process (CIRP), sold 82 apartments in the company’s projects, in violation of the law. The tribunal has now canceled the sale of these 82 flats and also imposed a fine of Rs 3 lakh on each of the promoters.
Financial Advisor & Manager and Vista ITCLFormerly an IL&FS trust company, took developer Rashmi Housing to the National Company Law Tribunal (NCLT)NCLT) after your default in payment.
The company was declared insolvent by the NCLT and appointed OP Agarwal 2018 as interim resolution professional to take over the operations of the defaulter company, while suspending its directors and informing them about the implications of suspension under the Code. In February 2019, an employee of the company, through an email, requested the resolution professional to authorize the suspended directors to sign pre-CIRP sale agreements.
In response to the said email, the resolution professional stated that for agreements relating to the pre-CIRP period, permission would be required to be placed before the CoC.
Advocate Rohan Agarwal appeared for the resolution professional of the company and argued that no permission was given at any point of time to sign the sale during CIRP or even during pre-CIRP.
The suspended directors had initially submitted a resolution plan in November 2019 after receiving an invitation for expression of interest and the same was rejected. These directors submitted a revised resolution plan which was placed before the Committee of Creditors (CoC) for consideration in its meeting held in March 2020. Due to rejection of this plan also, the resolution professional filed an application in June 2020 to initiate liquidation. The said application for liquidation is still pending and is under consideration.
In order to maintain the company as a going concern, the resolution professional retained some of the employees involved in day-to-day affairs. These retained employees were clearly informed to act only on the instructions of the resolution professional and not on the instructions of any suspended director.
These employees were aware of the unsold inventory of the company and it was practically impossible for the resolution professional to physically manage the 393 unsold inventory spread over 17 projects in 73 buildings located in different parts of Mumbai including Ghatkopar, Vasai and Naigaon. was impossible.
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