NCLAT Upholds Independent TV Liquidation, Rejects Reliance Realty's Appeal
The National Company Law Appellate Tribunal (NCLAT) has dismissed an appeal by Reliance Realty seeking recovery of rental and assets from Independent TV during its liquidation process. This decision upholds the earlier NCLT order to complete Independent TV's liquidation swiftly. NCLAT ruled that the liquidator had properly established asset ownership and noted Reliance Realty's failure to raise ownership concerns earlier. The tribunal also observed that Reliance Communications, currently in liquidation, would be the potentially aggrieved party as the original signatory. Shree Sai Baba Ship Breaking Company won the auction for Independent TV's 1,874 asset units.
*this image is generated using AI for illustrative purposes only.
The National Company Law Appellate Tribunal (NCLAT) has rejected an appeal by Reliance Realty, a step-down entity of Reliance Communications, seeking recovery of rental and assets from Independent TV during its liquidation process. This decision upholds the earlier order by the National Company Law Tribunal (NCLT) to complete Independent TV's liquidation in the shortest possible time.
Background of the Case
- Reliance Realty leased premises to Independent TV for DTH business operations in November 2017.
- Independent TV stopped paying rental and service charges after October 2018.
- Insolvency proceedings for Independent TV began in February 2020.
- Liquidation was ordered in March 2023.
Key Points of the NCLAT Ruling
Rejection of Appeal
NCLAT dismissed Reliance Realty's appeal for recovery of rental and assets.
Liquidator's Authority
The tribunal ruled that the liquidator had properly established ownership of assets.
Timing of Concerns
NCLAT noted that Reliance Realty failed to raise ownership concerns during earlier proceedings.
Potential Aggrieved Party
The tribunal observed that if any party should be aggrieved, it would be Reliance Communications as the original signatory, but RCom is currently in liquidation.
Asset Auction and Liquidation Process
- Shree Sai Baba Ship Breaking Company won the auction for Independent TV's assets.
- The auctioned assets comprise 1,874 units.
Reliance Realty's Actions
- Restricted access to assets, claiming unpaid rental dues for five years.
- Sought recovery of rental and assets during the liquidation process.
Implications of the Ruling
This decision by NCLAT emphasizes the importance of timely raising concerns in insolvency proceedings and upholds the liquidator's authority in establishing asset ownership during the liquidation process. It also highlights the complexities that can arise when multiple related entities are involved in insolvency and liquidation scenarios.
The ruling ensures that the liquidation of Independent TV can proceed as directed by the NCLT, potentially bringing closure to this protracted legal and financial dispute.
19
