The Delhi Bench of the National Company Law Appellate Tribunal (NCLAT) has ruled that an unregistered sale deed can’t be the basis to claiming an immovable property by a creditor. The observation by the NCLAT was made while delivering its verdict in the Sabita A Biswa versus Vinodkumar Pukhraj Ambavat case.
The NCLAT also observed that notarised sale deeds had no validity as far as property transactions are concerned.
In this case, Asrec India had filed initiated insolvency proceedings against RK Jain Constructions in the Cuttack bench of the NCLT under Section 7 of the Insolvency and bankruptcy Code, 2016. While accepting the petition, the Cuttack NCLT appointed Vinodkumar Pukhraj Ambavat as the resolution professional.
In the meantime, one of the creditors to RK Jain Constructions, Sabita A Biswa filed an appeal before the adjudicating authority, seeking her claim on one of the company’s properties. Along with her appeal, Biswa submitted a copy of the notarised sale deed, executed on a stamp paper worth Rs 100, on January 13, 2015. In an order on July 7, 2022, the adjudicating authority rejected her plea on the ground that an unregistered sale deed had no legal validity.
Following the order, Biswa moved the NCLAT, which eventually dismissed her petition while upholding the order of the adjudicating authority.