NCLT Case : Current status and orders

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Summary

1) Builder collected maintenance from small shopowners, did not pay maintenance for Food court, Banquet, multiplex, hospital etc. 
He did not pay property tax, electricity bills, water bills etc and did not give any accounts.
2) We tried to form a society but builder formed Dreams The Mall Company without our knowledge. We fought legally till High Court but High Court said we cannot form society as Company was already formed.
3) Despite written assurances builder continued to default on our property tax, light bills, water etc.
4) Hence we approached NCLT courts to get the Company dissolved. However it is taking more time than expected. In the interim NCLT court has appointed an administrator who by Profession is a Company Secretary and Chairman of the Western region for Association of Company Secretaries. Yet builder and a couple of sympathetic agents in the mall are putting roadblocks and delaying the dissolution of the Company.
5) We desperately need our water connection and Common Area electricity as tanker, generator and diesel expenses are becoming unbearable. 
6) While the NCLT case will ultimately give us justice, for water, we need to make use of the amnesty 'Abhay Yojna' scheme to save 60 lacs of the 1.03 crore water bill. We need to urgently approach High Court to safeguard our interests so that after paying 42 lacs the water connection does not get disconnected in future. This High Court case will help us in the electricity restoration as well.

 

Time line of the NCLT case

  1. Currently we are in the NCLT court against Dreams the Mall (DTM), HDIL and others by 138 shareholders of DTM against their mismanagement. We have demanded that they answer about the electricity, property tax, water and other payments that have not been paid to the authorities, despite members having paid CAM till nearly 2015.

  2. Case started in mid 2017, with submissions from all parties.

  3. In May 2018, the court appointed a commissioner to visit and report back the findings. He visited the mall, went through submissions from all parties, and submitted his report in July 2018.

  4. After deliberation on the report, overruling objections by HDIL & DTM, the court appointed an Administrator to maintain the mall.

  5. Court passed 15 Rs/Sq.Ft as CAM to be paid by all entities/owners in DTM.

  6. HDIL/DTM did not hand over to the administrator, and continued to stonewall. While DTM continued its non-cooperation, HDIL, DHFL, Multiplex, Hospital (Privilege Healthcare Co. Ltd.) did not pay anything to the administrator as CAM. PMC paid for about 6 months.

  7. While a number of members paid the CAM, and the mall substantially improved in the 1st few months, some misguided members with vested interests, wanted HDIL back, complained against electricity connection to administrator (which was to have been used for water pump), and against admin to  GST authorities etc. to jail the administrator and sabotage the efforts to revive the mall.

  8. Taking note of the same, the court granted immunity to the administrator against prosecution.

  9. HDIL, Hospital and related entities claimed that they have to only pay 10% of the CAM based on some dishonest agreement, and did not even pay that amount. Also they consistently managed to postpone, delay hearing and kept making irrelevant submissions.

  10. Administrator complained to the court about non-payment by big parties, and hence insufficient funds to run the mall. Court took note and said that people should pay first, and come in REPRESENTATIONAL capacity only then they can be heard.

  11. In the meanwhile nearly 100 more shop owners joined the movement for justice, and filed the petition to join in the case. This matter has not been heard yet.

  12. In Jan 2020, the court asked the administrator to provide a list of non-paying entities, and was to pass orders against them.

  13. The next hearing got cancelled, and subsequently courts got closed because of COVID lockdown.

  14. NCLT reopened for ONLINE hearing. The administrator, and our advocate pressed for an early hearing. Our matter got listed in October 2020. On 12, our hearing was lost because of the Mumbai blackout.

  15. In November, the bench (judges) had changed, and on 25 Nov, the new judges got introduced to all the parties, their advocates, and tried to consolidate all the different petitions/submissions.

  16. On 1st and 3rd December they heard our case back to back. HDIL, PMC Bank were represented by their administrators (you will be aware that directors from both entities are in jail related to the PMC bank fraud and failure). DTM and hospital was represented by a new advocate. BMC and other parties were also present. The court heard the administrator at length, Kini ji explained our issues. The court asked HDIL, PMC why they were not paying, and to their contention of not requiring to pay because of IBC proceedings, that they are to pay as they are paying salaries etc. HDIL mentioned they are not running anything from the mall, which was countered by the admin informing the court that Banquet hall was running, and causing havoc with garbage, leakage, and gas in the common areas etc.

  17. The judge gave a short date of 7th Dec, though DTM asked for a later date.

  18. On 7th DTM raised a question of maintainability of the petition raising doubt that informed consent had not been obtained by petitioners, some signatures were in hindi and the petition in English, and so on… DTM advocate said he needed 20 minutes atleast to explain his position on admissibility. Admin raised his urgency (money to maintain services, water reconnection etc.) for an order. Our lawyer Kini explained our plight. DTM asked the court not to pass an order before giving him time. Judge said that he will hear out on the 10th Dec 2020, and then pass an interim order as requested by the Administrator. It asked the administrator to submit an updated list of defaulters upto Feb 2020 (before COVID 19).

  19. Kini ji suggested that we get fresh affidavits from all petitioners, whence DTM advocate arguments become meaningless. We should be able to get it completely soon, and have already submitted a significant number to the courts as on 10th Dec 2020.

  20. However, the hearing on 10th Dec 2020, got adjourned. With your co-operation we hope to submit the remaining affidavits shortly, and get an order on payment WITH INTEREST/PENALTY by defaulters.

 

NCLT court orders in reverse order.

Order date

 Order Highlights with order link

16 Jan 2020

All entities to pay rs 15/sq.ft

 

Cannot approact NCLT without clearing CAM payment and coming as a group.

 In view of the same, we hereby direct all the shop owners in the
mall to forthwith comply with the directions of the court and make the
payment of Rs.15/- per sq.ft. as maintenance charges as ordered by
this court earlier.

We once again reiterate that all the shop owners
whosoever is conducting business or whosoever is holding the premises
shall make the payment without fail and may approach this Bench after
making the payment for any clarification in a representative capacity,
that means as a group together but not individually.
10 Oct 2019

Court took note of hindrances to the administrator.

Granted administrator immunity.		 However, one of the shop owner, namely, Mr. Velji Gada owning the Shop L-
396 at the Dreams Mall, with a view to create hindrance in the effective
functioning of the applicant as an Administrator of Dreams Mall, is filing
various complaints with various statutory authorities including the Police
Commissioner of Mumbai/Bhandup Police Station, Maharashtra State
Electricity Distribution Co Ltd, Municipal Corporation of Greater Mumbai and
with utter false and serious allegations against the applicant without any
substantial evidence to that regard.

In the circumstances, we are of the considered opinion that the
Administrator should be provided with the protection against any illegal
activities which are causing hindrances in discharging the official duties of
the Administrator. The administrator is an officer of the court, and in the
circumstances, he should be protected for the acts, which are being done in
discharging his official duties assigned to him.
In the above circumstances, we at this moment grant immunity to the
Administrator from all the actions arising out of discharging duties as an
Administrator of the Mall.
21 Feb 2019 Court directs police to help the administrator.
10 Dec 2018 Court orders DTM to hand over documents to the administrator.
Court asks administrator to take legal action against non-payers.
31 August 2018 Court appoints administrator to run Dreams the mall.
24 July 2018 Court commisioner submits his report.
8 June 2018 Court orders Dreams the Mall to cooperate with the court commisioner and hand over documents within 7 days.

23 April 2018

 Court appoint court commissioner to visit the mall and give a factual report.

 

 

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 Dreams the Mall Commercial Premises Welfare Association
 F64, Dreams the Mall, Bhandup (West), Mumbai-400078, Ph:   e.mail : dreamssociety1094@gmail.com
Last updated: 07/06/19