SURESH KUMARI vs REGISTRAR OF COMPANIES & ORS.

$~45
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of decision: 2nd February, 2024
+ W.P.(C) 1567/2024
SURESH KUMARI ….. Petitioner
Through: Mr. Sunil Dalal, Sr. Advocate
with Mr. Sandeep Sharma, Mr.
Akash Verma & Mr. Jai
Shankar Sikand, Advocates.
Ms. Manisha Saroha, Mr.
Nikhil Beniwal, Mr. Mahabir
Singh & Mr. NavishBhati,
Advocates.
versus
REGISTRAR OF COMPANIES & ORS. ….. Respondents
Through: Ms. Jyoti Taneja, Advocate for
R-11.
Mr. Nalin Kohli, Ms. Nimisha
Mennon, Ms. Vijeta Singh &
Mr. Arnav Behari, Advocates
for IRP
CORAM:
HON’BLE MR. JUSTICE DHARMESH SHARMA
DHARMESH SHARMA, J. (ORAL)
CM APPL. 6519/2024

1. This is an application moved on behalf of the petitioner seeking
permission to file uncertified and dim/untyped annexures, which are
otherwise quite legible.
2. Heard. The petitioner is granted exemption from filing certified

copies for now, with directions to place the same on the record at the
earliest, preferrable on or before the next date of hearing.
3. The application stands disposed of accordingly.

CM APPL. 6518/2024

4. None present for respondents, particularly respondents Nos. 1, 2
and 3 despite advance notice.
5. The petitioner is invoking extraordinary jurisdiction of this
Court under Article 226 read with Article 227 of the Constitution of
India praying for certain directions apparently in the nature of
mandamus to respondent No. 1-Registrar of Companies and
respondent No.2-Union of India, through Ministry of Corporate
Affairs, for initiating and carrying out appropriate inquiries and
investigation against the management of „Three C Shelters Private
Limited”, i.e., respondent No.3 and sister group of companies, for the
alleged acts of manipulating of records and siphoning off funds of the
said company to certain shell companies based in Kolkata and
elsewhere, freeze the assets of such unscrupulous companies including
respondent no. 3 and thereby preserve the legal rights of the
investors/home buyers like the petitioner.
6. The petitioner is a home buyer, who claims that she has been
sold a plot by respondent No.3 in the Real Estate project by the name
of „Greenopolis”, that was envisaged to be brought up at Sector 89,
Gurgaon, Haryana. It is alleged that respondent No.3 and the Ex-
Management/Directors have raised hundreds of crores from innocent
homebuyers including her but the funds collected have been siphoned
off to various shell/sister concerns of respondent No.3 and they have

been defrauded and deprived of their hard earned money that was
invested in the project, which project was never intended to be
completed by the promoters/ex-directors of respondent no. 3.
7. Shorn of unnecessary details, learned Senior Counsel for the
petitioner, during the course of elaborate arguments submitted that as
of now there about 138 investors/claimants /home buyers and as many
as 498 claims have been lodged before the Interim Resolution
Professional1 in CP IB No. 2721/2019, which has been instituted at the
behest of the operational creditors. Evidently, there have been several
stakeholders to such proceedings under the Insolvency and
Bankruptcy Code2 and several interim orders have been passed from
time to timein matters shuttling from NCLT3 to NCLAT4, this court
and even the Supreme Court.
8. It is urged by the learned Senior counsel for the petitioner that
the promoters/Ex-Management/Directors, who were kingpins of
fraudulent siphoning of funds of respondent No.3 in collusion with
some unscrupulous sham secured creditors brought about a situation
that culminated in passing of order dated 28.08.2023 by the NCLAT,
thereby setting aside the entire CIRP proceedings, which order has
since been challenged in Civil Appealsviz. No. 6797/2023 as also No.
774/2023. Suffice to state that in Civil Appeal No. 6797/2023,
preferred by some operational creditors, interim directions have been
passed by the Supreme Court vide order dated 13.10.2023, whereby

1 IRP
2 IBC
3 National Company Law Tribunal
4 National Company Law Appellate Tribunal

the parties have been directed to maintain status quo including with
regard to assets of the company (in liquidation) i.e., respondent No.
3/‘Three C Shelters Private Limited’.
9. On being queried, learned Senior counsel for the petitioner
submitted that this writ petition is per se maintainable as does not
tread into the territory of the Civil appeals pending before the
Supreme Court since the present petitioner is not a party in the
proceedings before the Supreme Court and that the petitioner is
invoking constitutional jurisdiction of this Court so to initiate legal
action against the promoters/ex-directors of respondent no. 3 and its
sister companies for protecting her legitimate interest. It is urged that
in any case the matter before the Supreme Court is pertaining to the
legality of the CIRP5 with respect to the company in liquidation,
which has been brought to a complete halt in a dubious manner. It is
submitted that the petitioner has approached this Court so as to seek
legal action based on the three reports submitted by the IRP before the
NCLT each dated 09.08.2023, that have shockingly been brought to
the fore that the Ex-Management/Directors of respondent No.3, after
raising funds from the investors/home buyerswithout any intention to
complete the project, have altogether abandoned the project, and in
order to shield themselves from any civil and criminal prosecution,
they have got into strategic collusive insolvency proceedings in order
to reap benefits of moratorium under Section 14 of the IBC thereby
pre-empting stalling of any legal proceedings against the promoters
and Ex-Directors of the company in liquidation.

5 Corporate Insolvency Resolution Process

10. It is pertinent to mention that learned Senior counsel alluded to
the damning findings and observations reported by the IRP before the
NCLT, which report is Annexure P-16 wherein vide paragraph (31)
onwards it has been brought to the fore that during the time leading to
respondent No.3 becoming involved in the insolvency proceedings up
to 16.10.2020 and thereafter, various dubious/suspicious transactions
had been carried from the bank account of the corporate debtors
maintained with State Bank of India, whereby inter alia a sum of Rs.
200 crores have been transferred by way of multiple transactions on
the very same day from one company to the another ostensibly to buy
shares of some Kolkata based shell companies in the name of the
corporate debtor and the money trail led to the following revelations:-

“31. (a)A Sum of Rs. 4,50,00,000/- was transferred from
theAccount of the Corporate Debtor to M/s Manak Estatesand
Finance Private Limited, and thereafter shares of aKolkata based
company namely GREATFUL INFRASTRUCTURES PRIVATE
LIMITED that too at a Price of Rs. 498 per share were purchased
from this money. It is important to state that this Kolkata
basedcompany is nothing but a shell company having investments
in the form of shares of some other companies. These aspects
require detailed investigation since it is prima facie apparent that
these companies arenothing but shell companies of Kolkata being
formed for conversion of black monies.

(b) Another such transaction is an amount of Rs.
127,25,00,000/- from the same suspicious bank account maintained
with State Bank of India wherein shares of some companies
namely ANGARIKA VINIMAY PRIVATE LIMITED,
GANADHIP EXPORTS PRIVATE LIMITED,AMARNATH
MARKETING PRIVATE LIMITED, JAIWANTI VYAPAAR
PRIVATE LIMITED, ATCHYUT CONSTRUCTIONS PRIVATE
LIMITED, COLLATE TRADELINK PRIVATE LIMITED,
GAJANANA FINCOMPRIVATE LIMITED, GREATFUL
INFRASTRUCTURES PRIVATE LIMITED were purchased. It is
further more surprising that these companies are also ex-facie shell
companies, having no assets except for investment in other
companies in the form of shares. Apart fromGREATFUL

INFRASTRUCTURES PRIVATE LIMITED, the names of rest
companies have already been struck-off from the record, as is
apparent from the website of Ministry of Corporate Affairs.
Curiously, the names of the companies were struck off, just after
few months after the shares were transferred in the name of the
Corporate Debtor.”

11. Alluding to the IIIrd status report at PDF page No. 995 of the
paper-book, it is pointed out that vide paragraph (7.1) & (7.2), the
following findings and observations have been brought to the fore as
well:-

“7.1. It is respectfully submitted that the records have revealed that
there is another group of company viz. Ace Group, wherein there is
a direct connection / commonality between the promoters of the
Three C Group and the Ace Group. The records demonstrate that
the management of Ace Group and Three C group is inter-related
with each other. This is also clearly established from the fact that
one Mr.Pratap Singh Rathi, Director of Ace Infracity Developers
Pvt Ltd. (one of the flagship companies of Ace Group) has been a
common director in M/S Ace Infracity Developers Pvt. Ltd. since
30.01.2015 till present and in Three C Residency Private. Ltd. (one
of the companies of Three C Group) from 30.10.2019 to
09.03.2021. Furthermore, Mr. Pratap Singh Rathi is also a director
in one more Three C Group company i.e. Three C City Developers
Pvt Ltd. from December, 2019 till date.
7.2. It is respectfully submitted that even Bright Buildtech Pvt.
Ltd. and the Ace Group have been working in close relation, and
the management of both the companies are inter-related to each
other. As elaborated in Para 6.2. herein above-
M/s Bright Buildtech Pvt. Ltd. is 100% owned by M/s Three C
Town Planners Pvt Ltd.
.
In 2012, 100% shareholding of Three C Town Planners Pvt Ltd
was held by M/s Three C Universal developers Pvt Ltd.
From 2012-2015 funds were siphoned off from the Corporate
Debtor to M/s Bright Buildtech Pvt Ltd
.
100% shares of M/s Three C Town Planners Pvt Ltd. were
transferred to Lotus Green LLP at merely Rs. 1 Lakhs
(M/s Lotus Green LLP is held by Mr. Harakaran Singh Uppal son
of Mr. Nirmal singh)
.

100% shareholding of M/s Three C Town Planners Pvt Ltd
(renamed as M/s Mega Town Planners Pvt Ltd.) was reported to be
transferred to M/s Ace Landcraft LLP at a consideration of merely
Rs. 1 lakhs.
7.2. It is respectfully submitted that the undersigned has identified
that funds from the Corporate Debtor have been diverted into
Bright Buildtech Pvt. Ltd. for the Project Ace Palms Floors,
Gurgaon. It is significant to note that the project Ace Palms Floors,
Gurgaon is owned by M/s Bright Buildtech Pvt. Ltd and Three C
group has close connections/ commonality of control with the Ace
Group.”

12. Referring to the relevant documents on the record, it has been
further pointed out by the learned Senior Counsel for the petitioner
that not only the names of some of the shell companies stood struck
off from the record but also over a short period of time as many as 10
sister concerns/shell companies of respondent No.3 have been
admitted to insolvency proceedings, which have been of collusive
nature and in this regard ld senior counsel lamented about the dubious
role played by the previous IRP, namely Mr. Chandra Prakash, who
allegedly submitted fabricated reports before the NCLT leading to his
suspension by IBBI6.
13. Further, learned Senior counsel for the petitioner referred to an
email dated 15.10.2019 by Mr. Surpeet Suri, one of the promoters of
respondent No.3, a bare reading of which would show that he
highlighted that about Rs. 500 crores having been siphoned off from
the respondent No.3 to its sister concerns and there is tabular depiction
of the names of the companies besides the trail of money/funds that
have been siphoned off including the details as to the date of the
transfers and amounts involved. It was also pointed out that there has

6 Insolvency and Bankruptcy Board of India

been a conspicuous common connection between the promoters of the
„Ace Group” and respondent No. 3 „Three C Groups of Management”
having common Directors and likewise with „M/s. Bright Buildtech
Pvt. Ltd” and other shell companies so much so that huge parcel of
land in YEIDA area (Yamuna Expressway Industrial Development
Area) as well in Gurgaon and other places have been transferred to
M/s. ACE Infracity for nominal value of Rs. 1 lac. This Court has
been taken through several documents on the record with respect to
transfer of shell companies to ACE Group. It is also submitted that
Ace Infracity Pvt. Ltd. is a proxy of respondent no. 3 and Resolution
Plan which has been submitted by the IRP is assailed before the
Supreme Court which has been stayed in Civil Appeal no.
007762/2023 vide order dated 08.01.2024.
14. In the backdrop of the aforesaid scenario, what becomes
evidently clear is that despite the fact that the entire damning
information having been brought to the knowledge of respondent
No.1 & 2, they are failing to perform its statutory duties in terms of
Chapter XIV of The Companies Act, 2013 to the detriment of large
homebuyers and financial institutions. In this regard, it has been
pointed out that the petitioner and several investors have already
written to respondent No.1 and respondent No.2 to initiate action
against respondent No. 3 and its promoters and Ex-Directors but they
are sitting over the matter.
15. During the course of arguments, it was also canvassed that
although IRP is seized of the assets of the respondent No.3 but in view
of the order dated 28.07.2023 passed by the NCLAT, which is now

under challenge before the Supreme Court, the IRP is not able to take
any further actions so as to inquire into the various facets of siphoning
of the funds by the culprits and retrieving the funds since the entire
CIRP proceedings have come to a complete halt.
16. Prima facie the facts and circumstances brought on the record
demonstrate a sordid state of affairs at the behest of unscrupulous
promoters/Ex-Directors running the affairs of respondent No.3 and its
group of companies who evidently, brazenly committing repeated or
multiple acts of siphoning of funds from one end to another and
thereby causing irreparable hardships to the petitioner and similarly
placed investors.
17. This Courts finds it unfathomable that the information about the
state of affairs of respondent No.3 and its group of companies have
not reached the ears of respondent No.1& 2, and yet shockingly no
action has been taken in terms of Chapter XIV of the Companies Act,
2013. It is but imperative that they must exercise their statutory and
public duties in arresting pilferage, siphoning off of the assets of
respondent company (in liquidation)/respondent No.3 and its group of
companies and safeguard the legitimate interests and rights of the
petitioner and those similarly placed. It is surprising that despite
issuance of advance notice and having a battery of lawyers on their
panel, no one has bothered to even appear for respondent No.1 and 2
today during the hearing.
18. There is no gainsaying that Chapter XIV of the Act provides for
a detailed mechanism to inspect, call for the accounts and record of
the company, inquire and investigate into the financial affairs of the

company. Further, where the Registrar or inspector has reasonable
grounds to believe that the books or documents with regard to the
company under investigation are likely to to be destroyed, mutilated,
altered, falsified or secreted, an order can be prayed for from the
Special Court for the seizure of such books and papers in the manner
provided vide section 209 of the Act and proceed for freezing of the
accounts of the company under investigation.
19. Considering the prayer made in the interim application moved
on behalf of the petitioner, unhesitatingly there are compelling and
justifiable grounds to pass certain directions so as to safeguard the
paramount interests of the petitioner and those who are similarly
placed in larger „public interest”.
20. Accordingly, following interim directions are passed:-

(i) Respondent Nos. 1 and 2, are hereby conjointly directed to
initiate action and ensure step-wise compliance in terms of Section
206 to 210 of the Companies Act, 2013 and other analogous
provisions in Chapter XIV of the Companies Act, 2013, and
thereby inspect the affairs of „Three C Shelters” and the related
companies of „Three C Shelters” in terms of the Status Reports of
the IRP before the NCLT as brought out in his reports dated 9th
August, 2023 and submit an Inspection Report within four weeks
from today before this Court;
(ii) Initiate appropriate legal action against respondent Nos. 6,7
and 8 thereby calling upon them to explain the diversion of funds
from respondent No.3 i.e., Three C Shelters Private Limited to
other shell companies/sister concerns of its group in terms of the
three Status report filed by the IRP dated 9th August, 2023 and take
appropriate decision as per the law; and
(iii) Respondent No.1 & 2 are hereby conjointly directed to call
for the record of the and/or seize the Books of accounts of all
related companies of Three C Shelters Private Limited, where the
funds have been diverted for the purposes of inspection and
ascertain the diversion/siphoning of the funds, and arrest further
exhaustion of such funds as per the law;

(iv) To trace the companies in which or to which the funds have
been further transferred and initiate action in terms of Section 209
and 221 of the Companies Act,2013 for freezing of the assets of
such companies, if so warranted, in a time bound manner; and
(v) To undertake all such necessary measures so as to preserve
the assets of the respondent company in liquidation besides the
sister concerns/shell companies to safeguard the interest of the
homebuyers and other secured & operational creditors.

21. A copy of this order be served immediately upon respondent
Nos. 1 an 2 for information and necessary compliance with directions
to submit their replies/ status report before the next date of hearing.
22. Notice of the present application as well as Writ Petition be
issued to all the parties afresh by all permissible modes including e-
mail as well as dasti. Notice be also issued to the standing counsel for
respondent No. 1 and 2 along with a copy of this order for information
and necessary compliance.
23. Re-notify for hearing on 14th March, 2024.
24. Copy of this order be given dasti to the petitioner for necessary
compliance.

DHARMESH SHARMA, J.
FEBRUARY 02, 2024
Sadique