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TMI Blog2018 (12) TMI 965X X X X Extracts X X X X X X X X Extracts X X X X ..... issues in that Suit are altogether different and do not relate the question of default in repayment of an admitted Financial Debt. As far as the question of the ‘default’ is concerned, it has already been established supra. Hence, to conclude the discussion it can be stated that the Petition under Adjudication deserves Admission. The facts of the case have already established that the amount claimed is ‘Financial Debt’ as defined U/s. 5 (8) of the Code and there is a Default in the re-payment of the Debt as defined U/s. 3 (12) of the Code. As a consequence, keeping admitted facts in mind that the Financial Creditor had not received the outstanding Debt from the Corporate Debtor and that the formalities as prescribed under the Code have been completed by the Financial Creditor the Bench is of the conscientious view that this Petition deserves ‘Admission’. - CP (IB) 1580/MB/2017 - - - Dated:- 23-10-2018 - MR M. K. Shrawat, Member (J) For The Financial Creditors/Petitioners : Mr. Ajay Kumar, PCS Authorised Representative For The Respondent/Corporate Debtor : Mr. Vishal Thakar, Advocate a/w. Mr. Ashish Pyasi, Advocate, Ms. Anjali Trivedi, Advocate, Ms. Pragya K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial Creditor has disbursed an Unsecured Loan amounting to ₹ 23,00,000/- during the Financial Years 2011-12 to 2013-14. And the Debtor has repaid the sum of ₹ 12,00,000/- towards the Principal amount and ₹ 12,856/- towards the Interest as on 31.08.2016. 4.4. It is case of the Financial Creditors that the Debtor has approached to the Financial Creditors for availing the above mentioned loans and therefore, on oral contract / agreement, the Financial Creditors have advanced the loans at the Interest rate of 18 % p.a. However, duly communicated on the day of disbursal of loan that it was a Short Term Loan to be repaid on demand at the rate of 18 % p.a. 4.5. As the Debtor, after 31.08.2016, has not further re-paid any amount availed; the Financial Creditors through their Advocate have issued Legal Notices dated 23.05.2017 to the Debtors, calling upon them to repay the remaining outstanding amount. 4.6. The Debtor has replied to the Notice through its letter dated 08.07.2017 wherein the Debtor has denied its liability towards any interest payment and also stated that the issue between the Financial Creditors and Debtor is pending for adjudication before the Hon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sr. No. Amount Disbursed Date Cheque No./Ref. No. 1. ₹ 10,00,000/- 14.02.2012 000040 2. ₹ 5,00,000/- 10.03.2012 000042 3. ₹ 8,00,000/- 24.12.2013 000011556555 (Rs. 2,00,000 each Transaction) 000011556645 000011556735 000011557023 Total ₹ 23,00,000/- The Ledger Account of the Debtor in books of the Financial Creditors evidences the above mentioned transaction. The copies of Ledger Accounts are annexed with the Petition. 5.4. It is further submitted that the Debtor had only repaid, to the 3rd Financial Creditor, an amount of ₹ 12,12,856/- in total which includes t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erms for payment of interest were never agreed upon between the parties. It is also stated that the Parties had agreed upon sharing of benefits / profits to the Debtor Company and therefore there is variable amounts were paid to the Financial Creditors. 6.4. It is also submitted that the Directors of the Financial Creditors, by fraud and with use of fabricated documents, have transferred Shares of various other companies controlled by the Directors of the Debtor. And when this fact had brought to the notice of the Directors of the Debtor, the Directors have filed the Civil Suit bearing no. 227/2017 before the Hon ble Bombay High Court, alleging the said fraud committed by the Directors of the Financial Creditors. 6.5. It is further submitted that in defence in the said Civil Suit the Directors of Financial Creditors have taken a stand that the Shares were transferred in favour of them in discharge of the Debt as recorded in the Exhibit F of the said Civil Suit. It has also brought to the notice that the Exhibit F to the said Civil Suit reflects the Principal Amounts claimed by the Financial Creditors. 6.6. In light of this Submission it is pleaded that the Hon ble ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncial Creditors towards the Interest Amount of Loan. 7.5. In light of above observation to answer the above framed first question it can be stated that the amount advanced by the Financial Creditors is an amount advanced as Loan . Moreover the Debtor has not made out a case of disbursement of any Dividend or Profit so as to demonstrate the impugned transaction at all related to an Investment. 7.6. To answer the second question it is necessary to examine the position of the Civil Suit filed before the Hon ble Bombay High Court. From the submissions by both sides it is noticed that the said Civil Suit is not yet decided by the Hon ble Bombay High Court and it is presently under Adjudication on the issue un-related to the Financial Debt in question. It is further noticed that the Directors of the Debtor has alleged the Fraud over the Directors of the Financial Creditors in the said Civil Suit. 7.7. It is also noticed that the Debtor, in this Petition, has took the defence that, the amount claimed by the Financial Creditors stands discharged, in light of Transferring of Shares in the names of the Directors of the Financial Creditors. However, it is noticed that the Lear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... b-section (2) is incomplete or any disciplinary proceeding is pending against the proposed resolution professional, it may, by order, reject such application: Provided that the Adjudicating Authority shall, before rejecting the application under clause (b) of sub-section (5), give a notice to the applicant to rectify the defect in his application within seven days of receipt of such notice from the Adjudicating Authority. 7.14. The above provision makes it clear that the Adjudicating Authority can dismiss a S. 7 Petition when either the Debt is not due and payable or the default in repayment is not arrived. The factual matrix of this case reveals that, as the Debtor had paid interest in the past, the question that the Debt not became payable yet; does not arises. Further, as the Financial Creditors did not received any amount after 31.08.2016 towards re-payment of the advanced loan, the Default, as defined U/s. 3 (12) of the Code, is clearly established. Further, despite the receipt of the notice, calling upon the loan, the Debtor had not made the payment is also evidence of Default. 7.15. It is also to be clarified that the Petition filed U/s. 7 if incomplete in pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t received the outstanding Debt from the Corporate Debtor and that the formalities as prescribed under the Code have been completed by the Financial Creditor the Bench is of the conscientious view that this Petition deserves Admission . 7.21. The Financial Creditors have proposed the name of Insolvency Professional. The Bench has perused the record the proposed IRP and noticed that, against him no disciplinary proceedings are pending. Consequently, the IRP proposed by the Financial Creditor, Mr. Saket Shantilal Jain, O/at. Office No. 70, 2nd Floor, Empire Building, Above Macdonald, 134, D N Road, Mumbai, Maharashtra 400001, E-mail : [email protected], having Registration no. IBBI/IPA-001/IP-P00065/2017-18/10151 is hereby appointed as Interim Resolution Professional to initiate the Insolvency Resolution Process. 7.22. Having admitted the Petition, the provisions of Moratorium as prescribed under Section 14 of the Code shall be operative henceforth with effect from the date of order and shall be applicable by prohibiting institution of any Suit before a Court of Law, transferring/encumbering any of the assets of the Debtor etc. However, the supply of essential goods or s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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