Tribunal says dispute over leased land, sub-lease rights and possession must be decided by civil court; holds Section 60(5) cannot be used for parallel adjudication.
The National Company Law Tribunal (NCLT), Principal Bench, New Delhi, has dismissed an application filed by landlord Vikas Chopra seeking exclusion of a leased industrial plot in Jhajjar, Haryana, from the liquidation estate of VHV Beverages Private Limited and restoration of vacant possession.
The application was filed under Section 60(5) of the Insolvency and Bankruptcy Code, 2016 (IBC) against the company’s liquidator, Mr. Vivek Parti. Chopra argued that the lease had expired in November 2021, that no renewal had been granted, and that the corporate debtor had no right to continue occupying the land. He also alleged that the premises had been sub-let in violation of the lease deed.
The Tribunal, however, found that the dispute could not be entertained because civil suits concerning the same property and the rights of the parties were already pending before competent civil courts. It noted that Civil Suit No. 356 of 2021 and Civil Suit No. 593 of 2025 involved the leased premises and related claims, including the alleged sub-lease in favour of Crystal Beverages.
Relying on the principle behind Section 10 of the Code of Civil Procedure, the NCLT held that a party cannot pursue parallel adjudication of the same controversy before two forums. It said the applicant, having already approached the civil court, could not seek substantially the same relief before the NCLT under the insolvency law.
The Tribunal also held that Chopra had suppressed a material fact by not disclosing the pending civil proceedings in the original application. According to the order, the pendency of those suits had a direct bearing on maintainability and jurisdiction, and the later disclosure in the rejoinder did not cure the omission.
On merits, the NCLT observed that while the land itself was admittedly not part of the liquidation estate under Section 36(4) of the IBC, the dispute involved broader questions of ownership, possession, lease rights and the alleged pre-CIRP sub-lease to Crystal Beverages. Such issues, the Tribunal said, were outside the scope of Section 60(5) when they arose from an independent civil dispute rather than from the insolvency process itself.
The Bench further noted that the applicant had filed claims for lease rentals during CIRP and liquidation, and that the liquidator had admitted and paid part of those dues. It held that the applicant could not accept lease rentals during insolvency proceedings and simultaneously challenge the corporate debtor’s occupation before the tribunal.
Dismissing the application, the NCLT clarified that its order would not prevent Chopra from claiming lease rentals or pursuing other remedies available in law. It also stated that its observations were limited to the present application and would not affect the merits of the civil suits pending elsewhere.
Bottom Line :
Insolvency and Bankruptcy Code, 2016 - Application by landlord under Section 60(5) seeking exclusion of leased land from liquidation estate and restoration of possession - Held, where civil suits concerning same property, possession and sub-lease rights are already pending, parallel adjudication before NCLT is not maintainable - Non-disclosure of pending civil proceedings amounts to suppression of material facts - Though third-party owned land is excluded from liquidation estate under Section 36(4), NCLT cannot adjudicate independent ownership/possession dispute involving pre-CIRP sub-lease and third-party rights merely because one party is Liquidator.
Statutory provision(s): Section 60(5), Section 36(4), Section 35, Section 33(5) of the Insolvency and Bankruptcy Code, 2016; Section 10 of the Code of Civil Procedure, 1908
Mr. Vikas Chopra v. Mr. Vivek Parti, (NCLT)(Principal Bench New Delhi) : Law Finder Doc id # 2983529
