Nazru S Basheer Vs Pancard Clubs Limited (NCLAT Delhi)
National Company Law Appellate Tribunal (NCLAT), Delhi Bench, has affirmed an order issued by the National Company Law Tribunal (NCLT), Mumbai, directing Nazru S Basheer, a hotel operator, to vacate the ‘MB International’ hotel property belonging to Pancard Clubs Limited, the corporate debtor currently undergoing corporate insolvency resolution process (CIRP). The decision, delivered on May 6, 2025, underscores the NCLAT’s stance on possession rights post-resolution plan approval and the impact of the Insolvency and Bankruptcy Code (IBC) moratorium on existing agreements.
Background of the Dispute
The ‘MB International’ hotel property is owned by Pancard Clubs Limited (referred to as the Corporate Debtor, or CD), which is subject to a CIRP initiated under Section 7 of the IBC. On July 3, 2017, the CD had entered into a “Conduct Agreement” with Nazru S Basheer (the appellant), granting him the right to operate the hotel, its restaurant, and a gift shop for a period of six years. This agreement also stipulated royalty payments.
In 2022, CIRP proceedings commenced against Pancard Clubs Limited. The appointed Resolution Professional (RP) subsequently sought information regarding the hotel property and the Conducting Agreement. Following initial non-compliance, the CD eventually provided a copy of the agreement. The RP then issued legal notices on April 8, 2023, and May 11, 2023, demanding outstanding royalty payments and the vacant possession of ‘Hotel MB International’. It was noted that this property had previously been attached under actions by SEBI and the Economic Offences Wing of Maharashtra Police.
