2019 (9) TMI 1609 - Tri - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors/home buyers - time limitation - petition filed within the time period fixed under the agreement or not - HELD THAT - It is evident that the Financial Creditor has chosen to enter into an agreement, for whatever reasons best known to it, in the project, Kumar Golf Vistas for a flat. Thereby virtually, making the Financial Creditor as a Home Buyer taking into consideration Sec 5(8) (f) IBC,20 16 read with explanation provided thereunder and enabling it to maintain petition under IBC,2016 as a Home Buyer in case of default on the part of the Corporate Debtor named as the promoter therein. In terms of clause 5(i) of the agreement the promoter was required to complete the building within 12 months from the date of signing the agreement and also providing under clause 5(ii) a grace period of 180 days. The price of the flat namely K-708, under clause 3(a) is fixed as ₹ 49,59,375/- - the wordings in clause 5(ii) clearly evidences that the parties have virtually agreed to appropriate the loan amount granted earlier as the consideration for the flat purchase as otherwise the wordings as extracted above is an anomaly. It is pertinent to note that the execution of the agreement dated 1 October 2016 is not denied by the parties. Hence, considering the said agreement to be the fresh bargain as entered into between the parties thereby giving a go by to the earlier MOUs as well as the loan transaction of ₹ 50 Lakhs. From the records, it is seen that the letter of offer of possession is enclosed dated 7 March 2018 by the Corporate Debtor in its reply. From the terms of the agreement and as given in paragraph supra in relation to time limit for possession to be given, taking into consideration the grace period of 6 months and well as contracted period of 12 months, the possession of flat booked should be given on 1.4.18.(as the agreement dated 1/10/16 stipulated that the possession will be given within 18 months i.e. 12 months plus grace period of 6 months) it is also required to note that the petition was filed on 4.1.2018 well before the period fixed under the agreement dated 1.10.2016. On the date of filing of petition as a (Home Buyer) no default stands established, more so, when the possession also seems to be offered before the completion of the date of possession as given in the agreement - Petition dismissed.

Summary

Issues Involved:
- Application filed under Insolvency and Bankruptcy Code, 2016 by Financial Creditor against Corporate Debtor.
- Dispute regarding loan repayment, MOUs, mortgage of flats, and creation of charge in favor of Financial Creditor.
- Allegations of debt discharge by Corporate Debtor based on Builder Buyer Agreement (BBA) dated 1.10.2016.
- Arguments regarding suppression of facts, existence of BBA, and loan repayment.
- Examination of various MOUs, security creation, non-payment of interest, and creation of charge in Registrar of Companies records.
- Analysis of the agreement dated 1 October 2016 between Corporate Debtor and Financial Creditor.
- Interpretation of clauses in the agreement, consideration for flat purchase, and implications for loan transaction.
- Entitlement of Financial Creditor to maintain a petition under Section 7 IBC, 2016 in case of default.
- Evaluation of possession offer, time limits, and filing of the petition.
- Conclusion on the premature filing of the petition and the right of Financial Creditor to approach other forums.

Detailed Analysis:
1. The application under the Insolvency and Bankruptcy Code, 2016 was filed by the Financial Creditor against the Corporate Debtor, alleging non-repayment of a loan and mortgage of flats without creating a charge in favor of the Financial Creditor. The Corporate Debtor disputed the debt, claiming it was discharged through a Builder Buyer Agreement (BBA) dated 1.10.2016, which the Financial Creditor allegedly concealed in its demand letters.

2. The Tribunal examined the series of MOUs between the parties, the security creation, and the non-payment of interest by the Corporate Debtor after June 2016. The Financial Creditor argued that the BBA was signed for security purposes, as no charge was created compliant with the Companies Act 2013. The Corporate Debtor's delayed response and reliance on the BBA for debt discharge were questioned.

3. The agreement dated 1 October 2016 between the parties indicated the Financial Creditor's involvement as a Home Buyer in the project "Kumar Golf Vistas." The agreement specified terms for flat purchase, possession timelines, and consideration for the flat, implying a fresh bargain overriding previous MOUs and loan transactions.

4. The Tribunal analyzed clauses in the agreement, particularly regarding the appropriation of the loan amount as consideration for the flat purchase. Despite the agreement, the Financial Creditor retained the right to file a petition under Section 7 IBC, 2016 in case of default in possession or refund of money under the agreement.

5. The possession offer by the Corporate Debtor and the timeline for possession as per the agreement were considered. The premature filing of the petition was noted, leading to its dismissal. However, the Financial Creditor retained the right to seek recourse in other judicial forums based on relevant precedents.

6. The judgment highlighted the intricacies of the loan dispute, debt discharge claims, and the significance of the agreement dated 1 October 2016 in determining the rights and obligations of the parties involved.