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TMI Blog2019 (9) TMI 1361X X X X Extracts X X X X X X X X Extracts X X X X ..... f the buy-back agreement and the proceedings under section 7 of the I and B Code, 2016 is independent of the buy-back agreement. The contention of the respondent that the applicant should have invoked the arbitration clause as per the memorandum of understanding does not hold any water as it is well established that arbitration clause is no bar for the initiation of CIRP - the debt and default of the corporate debtor has been established and the application deserves to be admitted. Application admitted - moratorium declared. - C. P. (IB) No. 1023/NCLT/MB/2019. - - - Dated:- 19-9-2019 - V. P. Singh (Judicial Member) And Rajesh Sharma (Technical Member) For the Applicant : Karl Shroff, Soura Subha Ghosh and Shivani Parikh For the Respondent : Mutahhar Khan, Ms. Naseem Patrawala and Ms. Nusrat Chaudhary ORDER RAJESH SHARMA (TECHNICAL MEMBER) .- 1. This is an application being C. P. No. 1023(IB)/MB/2019 filed by Dalmia Group Holdings, proprietorship of Mridu Hari Dalmia Parivar Trust, financial creditor/applicant, under section 7 of the Insolvency and Bankruptcy Code, 2016 ( I and B Code) against Lokhandwala Infrastructure P. Ltd., corporate debtor, f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on time and were delayed payments. The applicant submits that the respondent has defaulted in making payments from the third quarter of the financial year 2017-18 and has not honoured the terms of the memorandum of understanding dated April 4, 2016. 7. It is submitted that the applicant issued a letter dated May 8, 2018 demanding the payments of outstanding interest instalments for December, 2017 and March, 2018 including default interest and other non-compliances. The respondent in response to the abovementioned letter has admitted its liability to repay the debt in its e-mail dated May 9, 2018. Copy of the e-mail dated May 9, 2018 is annexed to the application. The relevant extract from the reply in e-mail has been reproduced hereinbelow : With respect to paragraph 1 we admit that there has been some delay at our end in making payments. We assure of honouring our commitments at the earliest and considering our long standing rela tions would request you for a waiver of the default interest outstanding as claimed. The appalling market conditions have been a reason for us not being able to comply with some of our obligations towards you and we sincerely regret for the same. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er, the respondent retained the right to buy-back the said commercial units after a period of 24 months but before the expiry of 36 months from the date of disbursement of the advance amount by the applicant. The applicant disbursed a sum of ₹ 25,00,00,000 (rupees twenty-five crores only) as advance amount out of the total consideration of ₹ 41,16,96,000 (rupees forty-one crore sixteen lakhs ninety-six thousand only) for purchase of the commercial units. The applicant was to pay the balance consideration at the time of taking possession of the said six units. 16. The advance consideration of ₹ 25,00,00,000 (rupees twenty-five crores only) is loan/finance granted by the applicant to the respondent as the same is given for the time value of money, the said financial facility thus amounts to financial debt within the meaning of section 5(8) of the I and B Code, 2016. Copies of the memorandum of understanding dated April 4, 2016, the buy-back agreement dated April 4, 2016, the corporate guarantee dated April 4, 2016, personal guarantee dated April 4, 2016 and the undated agreements of sale are annexed to the application. It is pertinent to mention that all the docu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Code is established and all other requirements are fulfilled, the insolvency resolution process has to be triggered. In the case of Innoventive Industries Ltd. v. ICICI Bank [2017] 205 Comp Cas 57 (SC), the hon'ble Supreme Court of India observed that (page 88) : ... in the case of a corporate debtor who commits a default of a financial debt, the Adjudicating Authority has merely to see the records of the information utility or other evidence produced by the financial creditor to satisfy itself that a default has occurred. It is of no matter that the debt is disputed so long as the debt is 'due', i. e., pay able unless interdicted by some law or has not yet become due in the sense that it is payable at some future date. 22. In the light of the above judgment, and the facts of the case, it is imperative to mention that the contention of the respondent that the applicant has levied high rate of interest is untenable and is of no consequence. Further, the contention of the respondent that the applicant ought to have exercised the put option available to it under the buy-back agreement is also untenable as the default is independent of the buy-back agreement an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... est Act, 2002 (54 of 2002) ; (d) the recovery of any property by an owner or lessor where such property is occupied by or in possession of the corporate debtor. II. That the supply of essential goods or services to the corporate debtor, if continuing, shall not be terminated or suspended or interrupted during the moratorium period. III. That the provisions of sub-section (1) of section 14 of the I and B Code shall not apply to such transactions as may be notified by the Central Government in consultation with any financial sector regulator. IV. That the order of moratorium shall have effect from the date of this order till the completion of the corporate insolvency resolution process or until this Bench approves the resolution plan under sub-section (1) of section 31 of the I and B Code or passes an order for the liquidation of the corporate debtor under section 33 of the I and B Code, as the case may be. V. That the public announcement of the corporate insolvency resolution process shall be made immediately as specified under section 13 of the I and B Code. VI. That this Bench at this moment appoints Mr. Ajit Kumar, a registered insolvency resolution professional ..... X X X X Extracts X X X X X X X X Extracts X X X X
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