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RERA Succeeds Over Companies Act, Winding Up Order Will Not Obstruct The RERA Proceedings : Rajasthan Authority

Team SoOLEGAL 27 May 2019 5:00pm

RERA Succeeds Over Companies Act, Winding Up Order Will Not Obstruct The RERA Proceedings : Rajasthan Authority

 

The Rajasthan Real Estate Regulatory Authority held that winding up order under Section 279 of the Companies Act 2013 will not obstruct proceedings under Real Estate (Regulation and Development) Act 2016. This was held while the Authority dismissed an application filed by the builder pursuing stay of proceedings on ground that Delhi High Court had appointed a liquidator in respect of the builder company, while the proceedings under the RERA is pending.

The builder quoted Section 279 of the Companies Act, which state that no suit or legal proceeding can be commenced or continued against the company after passing of the winding up order except with the permission of the Tribunal. The Authority noted that no winding up order as such has been passed. The mere appointment of the provisional liquidator without passing of a winding up order will not attract debar under Section 279 of Companies Act.

"appointment of provisional liquidator is of no consequence when it comes to staying or not staying a pending suit or other legal proceeding. It is the winding up order, and only the winding up order, which is relevant for staying a pending suit or legal proceeding", stated the Authority.

Furthermore, Authority stated that even if a winding up order is passed, it will not affect RERA proceedings. Referring to Section 89 of the Act, it observed that RERA has supreme effect over Companies Act, as a special statute. It also held that RERA will prevail over Companies Act as RERA is a latest statute.

"the provisions of Section 31 of RERA will prevail over Section 279 of the Companies Act", the Authority stated.

 The Apex Court judgment in Allahabad Bank vs Canara Bank and ors (2000) 4SC C406, which held that RDB Act will prevail over the Companies Act, was also stated to strengthen the order of dismissal.



Tagged: RERA   windingup   companiesact   section279  
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