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TMI Blog2019 (2) TMI 1040X X X X Extracts X X X X X X X X Extracts X X X X ..... nd, Second Applicant is the wife of the First Applicant. As per the particulars of financial debt given in Form-I filed u/s 7 of the Code r/w Rule 4 of Insolvency & Bankruptcy (Application to Adjudicating Authority) Rules, 2016, these Applicants disbursed the monies to the Corporate Debtor as follows: PART-IV PARTICULARS OF FINANCIAL DEBT 1. Total amount of debt granted date(2) of disbursement Sl. No. Cheque No. Date Drawn on Amount Rs. 1. 005854 01.11.2002 HSBC Bank 50,00,000 2. 005865 06.01.2003 HSBC Bank 25,00,000 3. 841264 01.03.2003 Punjab National Bank 50,00,000 4. 011145 07.08.2003 Indian Overseas Bank 25,00,000 5. 829107 13.08.2003 Indian Overseas Bank 25,00,000 6. 829112 12.09.2003 Indian Overseas Bank 35,00,000 2. Amount claimed to be in default and the date on which the default occurred (attach the workings for computation of amount and dates of default in tabular form) Total amount to the tune of Rs. 4,41,60,00 [Rupees Four Crores Forty One Lakhs and Sixty Thousand only] Rs. 2,10,00,000 [Rupees Two Crores and Ten Lakhs on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ONCERN DATE Bank Name Cheque No. FAVOURING Amount Rs. 01.10.2003 Canara Bank 586096 CHENNAI CUSTOMS -DD 5,305,000 12.12.2003 American Express Bank 696401 K. JAYARAM 1,660,000 14.02.2004 American Express Bank 696420 K. JAYARAM 2,00,000 15.03.2004 Canara Bank 165394 DD 1,75,000 18.03.2004 American Express Bank 696468 K. JAYARAM 700,000 22.04.2004 Cash 150650 K. JAYARAM 124,650 04.05.2004 American Express Bank 696601 K. JAYARAM 700,000 29.06.2004 Standard Chartered Bank 685321 K. JAYARAM 1,000,000 03.07.2004 American Express Bank 696671 DEPOSIT 200,000 09.07.2004 American Express Bank 696689 K. JAYARAM 550,000 14.07.2004 Canara Bank 795937 K. JAYARAM 200,000 1,08,14,650 7. To fortify that partnership firm M/s. Radha Exports made the above payments to the Applicants, the corporate debtor has filed statements of account copies as Annexure-Al. On verification of the items given in the above table with the payments reflected in the bank statements filed by the Corporate Debtor, we have noticed that they are true and correct. The Applicants have not placed any material against Bank statements file ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee cheque from my NR A/c. Out of the aforesaid sum, I have requested to transfer a sum of Rs. 90,00,000 (Rupees Ninety Lakhs) to my Wife A/c Mrs. Shoba Jayaram for allotment of shares in Radha Exports (India) Pvt. Ltd. I am a NRI and I am doing business outside India for many years. And I operate my NR A/c with IOB Mahalingapuram Branch, I have advanced this money to Radha Exports out of my Savings in NR A/c at HSBC (A/c Nos: 041 063934006, 041 063934007, 041 529371006), & IOB (SB A/c No: 17182). Further, I also confirm that we were residing at No. 34, Gill Nagar 2nd Street, Choolaimedu, Chennai-94 in India and proof of our residence (EB Copy, Ration Card, Credit Card Statement and NR Bank A/c Copies) is also enclosed for your verification. Yours sincerely, Sd/- Mr. K. Jayaram Sd/- Mrs. Shoba Jayaram For RADHA EXPORTS (INDIA) PVT. LTD. Sd/- M. KRISHNAN Managing Director " 10. In addition to the above letter, the Corporate Debtor has also placed another letter dated 11.01.2011 Second Applicant addressed to the Deputy Commissioner of Income Tax confirming that she requested the Corporate Debtor to allot shares in the name of First Applicant against her share appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... K. JAYARAM 150,000 13.01.2006 Standard Chartered Bank 891386 K. JAYARAM 125,000 09.02.2006 Standard Chartered Bank 988089 K. JAYARAM 125,000 22.02.2006 Standard Chartered Bank 988121 K. JAYARAM 200,000 18.03.2006 Standard Chartered Bank 557809 K. JAYARAM 125,000 23.03.2006 Standard Chartered Bank 298112 K. JAYARAM 500,000 Total Rs. 43,25,000 13. The corporate debtor counsel says that these payments were made to the first Applicant through bank accounts as shown in the Annexure-A3 annexed to the Reply Affidavit. By saying this, the Corporate Debtor submits that it has paid more than Rs. 21,85,350 to the First Applicant from the date of incorporation till 23.03.2006, it has further said that an additional amount of Rs. 21,39,650 was debited to the account of the First Applicant and the same was adjusted against part of the share application money. As regards share application money of Rs. 90,00,000, the corporate debtor counsel says, since the Corporate Debtor could not allot shares to Second Applicant, the same was shown as share application money pending allotment from the Second Applicant (as per the request letter of First Applicant) in the books of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed, now the points for consideration are, as to whether any financial debt is in existence in between the parties as on the date of filing petition u/s 7 of the Code and as to whether, assuming the financial debt is in existence, the debt is barred by limitation or not. 18. It is evident from the facts that first Applicant advanced Rs. 2,10,00,000/- Rs. 2,20,00,000, as the case may be, to a partnership firm during the period in between 2002 and 2003. It is also evident on record by 14.07.2004, the same partnership firm repaid Rs. 1,08,14,650. To show that it has been paid, the Corporate debtor has placed proof by submitting copies of the statement of accounts of various banks reflecting payments made to these Applicants, on the contrary, these Applicants have not placed any material showing as to whether these payments were made or not. 19. In fact, since it is summary jurisdiction conferred upon this Bench to deal with basing on material papers placed by the Applicants, it is their bounden duty to prove that there is a financial debt between the Creditor and the Debtor as on date is in existence as prescribed under the Code and the regulations thereto. 20. According to the defi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... financial statements showing that the debt has not to be paid shall be established by the financial creditor, alternatively, in scenario three, an order of the Court or Tribunal adjudicating upon non-payment of a debt. 23. Here these Applicants have not placed any material to contemplate that any of these three scenarios is accomplished by this Financial Creditor to prove that it is a financial debt. 24. Why this Adjudicating Authority is required to strictly adhere to these mandates is, it is not a forum for recovery of money and it is not the only remedy available to the parties to proceed against the Corporate Debtor for recovery of money. Since there is already another remedy available under Civil Court, the discretion that has to be exercised by this Bench shall be limited to the mandate as given under the Code. Because whenever any doubtful situation is arisen, as we all know that it has to be strictly proved on conducting trial as enunciated under C.P.C. Here, by looking at the documents, we are conferred with power not only to decide the property right of a Creditor but we are to decide the fate of the Company by seeing a debt claim made by a Creditor. Since the conseque ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Debtor to treat Rs. 90,00,000 out of the balance payable to them as share application money of the First Applicant on 11.01.2011. Second Applicant wrote the letter to the same authority confirming that she requested the Corporate Debtor to allot shares to her husband (First Applicant) against the share application money lying in the name of her. Since the Second Applicant, on record having continued as one of the directors of the Corporate Debtor since incorporation until she resigned as a director from 20.07.2004 to 20.06.2007, it further corroborates that these Applicants are not strangers to the Corporate Debtor and they have participated in the management of the Company since incorporation. When this much material is staring at us from the Corporate Debtor side proving that no debt was in existence as on the date of filing winding up petition, this case could not be considered as financial debt. If at all any claim is left payable, it could be share application money pending with the Company not any financial debt as stated by the Applicant. 29. In view of these reasons, no financial debt is in existence between the parties as on the date of filing this case. If any disburseme ..... X X X X Extracts X X X X X X X X Extracts X X X X
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