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TMI Blog2021 (4) TMI 145X X X X Extracts X X X X X X X X Extracts X X X X ..... partment shall not be entitled to any remedy under this Code. It is relevant to observe here that even though the Petitioners are not able to demonstrate that the case falls within purview of the extant provisions of the Code, the fact remains that Respondent admittedly is in receipt of the money in question paid by the Petitioners. As rightly contended by the Petitioners, the Respondent, by knowing well about the nature of property and law on transfer of such property, have falsely represented and duped them to enter into the Agreement in question. It is not the case of Respondent that they have apprised the Petitioners about the issue they have raised now to oppose their claim. Therefore, though the case is not fit to initiate CIRP, it is fit case for the Petitioners to initiate appropriate Civil and Criminal proceedings against the Respondent for their misrepresentation and claim appropriate reliefs in those proceedings. The Petitioners have failed to make out any case so as to initiate CIRP in respect of the Corporate Debtor. However, the Petitioners can be granted liberty to initiate appropriate Civil and Criminal proceedings before jurisdictional Courts - Petition dismissed. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Creditors approached the Corporate Debtor and requested for executing the Agreement of Sale as per the terms and conditions of the Agreements 1 to 4, but the Corporate Debtor sought more time for executing the Agreement of sale and assured that the same will be executed within few weeks. Further, even after waiting for few weeks the Corporate Debtor failed to execute the same. The Applicant No. 1 still made the full payments of sale consideration amount aggregating to ₹ 9,25,000/- till date, Applicant No. 2 has made payments aggregating to ₹ 7,60,500/- out of total sale consideration amount of ₹ 9,25,000/- till date, Applicant No. 3 made the payments aggregating to ₹ 9,15,500/- out of total sale consideration amount of ₹ 9,25,000 till date and Applicant No. 4 made the payments aggregating to ₹ 7,60,500/- out of total sale consideration amount of ₹ 9,25,000/- till date. (4) As per the terms and conditions of the said Agreements the Corporate Debtor agreed to complete the development within 60 months from date of execution of said Agreement with a further reasonable extension for 6 months and if the Corporate Debtor fails to complete the deve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... application before this NCLT seeking initiation of insolvency proceedings against a Developer. The first proviso to Sec. 7(1) stipulates a minimum of 100 homebuyers or 10% of the total number of homebuyers in a project have to jointly file the preferred Petition together in order to initiate CIRP against a Developer. The Petitioners do not constitute 10% of the buyers. Hence, the Petition is liable to be dismissed on this ground alone. The Petitioners do not fall within ambit of Financial Creditor as defined U/s. 5(7) of the Code, since the Petitioners are not covered within definition of Allottee under the Real Estate Regulating Authority Act. A purchaser of an agricultural property does not fall into the ambit of Allottee and they cannot be termed as a financial creditor. Further, the amount that has been paid to the Corporate Debtor is for purchase of site which is a transfer of interest in immoveable property and the same cannot be termed as a financial debt since the money given did not have consideration for time value of money as defined u/s. 5(8) of the Code. (3) The property to be sold has not yet been demarcated and neither has it been converted since it remains an agricu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... briefly stated supra, has also filed her written arguments dated 02.03.2020, by inter alia stating as follows: (1) The investment made by the Applicants fall within the ambit of Financial Debt, as defined u/s. 5(8) of the Code and it the time value of money. Further, according to Black's Law Dictionary, the word Time Value is defined as 'Price Associated with the length of time that an investor must wait until an investment matures or the related income is earned . Further the bare perusal of the Section 5(8) of the Code and the definition of time value would render a prima facie conclusion that the aforesaid transaction is a financial debt. The Applicants have incurred expenditure to acquire property to produce revenue. (2) As per terms of Agreements, the Corporate Debtor will provide exact plot description after demarcation process. Further the Corporate Debtor has allotted a Plot No. 91, 92 and 89, which are supposed to be developed as per the said scheme to Applicants 1 to 3 respectively. Upon bare perusal of the definition of the Allottee and Real Estate Project, it is prima facie evident that the Applicants are allottee as defined u/s. 5(f) of the code. The Financial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and since 30 days have lapsed since the notification of amendment, the Petition is liable to be dismissed. (2) The Petition is not maintainable as it doesn't fulfill criteria of minimum default amount of Rs. One Crore by virtue of Notification 1076 by MCA published in the Gazette of India on 24.03.2020. The claim amount of the present case is ₹ 47,52,180/-, which is towards four Petitioners. Further, the Petition is not maintainable by virtue of Ordinance No. 34 by MCA published in the Gazette of India on 05.06.2020, which provides for suspension of IBC proceedings initiated under the Code for one year. (3) The Petition is also not maintainable as it has not submitted default record from the information utility specified by the NCLT Order by virtue of File No. 5/02/2020 dated 12.05.2020. Filing of record of the Default of information utility is a mandatory requirement under Sec. 7(3) of the Code. (4) The Exhibit A, F, K and P placed at the main Petition clearly stipulates that the Respondent have entered into an arrangement for providing expertise service for development of the said land. Nowhere does the Agreement Stipulate that there are any title over the said land. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the First Party agrees to refund the entire amount paid by the Second Party with accrued interest at the existing Bank Rate OR alternatively allot another plot to the Second Party in any of the Properties/Developments promoted or developed by the First Party or its nominees in India, with the prior consent of the Second Party. 8. In Pursuant to the negotiations between the parties, the First Party has offered to sell the below listed plot and the Second Party has agreed to purchase the said plot in the aforesaid project, on the terms and conditions mentioned therein. The exact plot description shall be provided to the Second Party after the demarcation process is completed within 60 months from execution. Plot 92 Area ad measuring about One Acre , 4040 Sq. mts. Approx (Inclusive of Road ) Total consideration Rs 9,25,000/- The Respondent shall deliver one acre land, out of which approximately 3560 Sq. ft. shall be utilized for providing internal access Motorable road to the property. In pursuant to the above Receipt Agreement dated 28.09.2012, the Petitioners have not produced any legally enforceable Agreement of Sale except correspondences with regard to the payments made and ack ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hreatened the Respondent to initiate CIRP. Therefore, the present Petition is filed for recovery of amount paid to the Respondent, which is against the object of Code. 10. Even if the Petitioners deemed to be Home buyers, they are not fulfilling the requisite conditions prescribed U/s. 7 of the Code, wherein a minimum of 100 Homebuyers or 10% of the total number of homebuyers in a project have to jointly file the Petition together in order to initiate CIRP. The Petitioners admittedly do not meet the above criteria. Moreover, the Petitioners are purchaser of an agricultural property and that amount has been paid to the Corporate Debtor is for purchase of sites with development. The Petitioners have not controverted the contention of Respondent that Property in question is an Agricultural land with so many restrictions imposed on it, as per law, for their transfer. As stated supra, as per the said Agreements, there is an alternative choice for the Corporate Debtor to allot another plot to the Petitioners in any of the Properties/Developments promoted or developed by the First Party or its nominees in India, with the prior consent of the Second Party. There is an arbitration clause av ..... X X X X Extracts X X X X X X X X Extracts X X X X
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