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TMI Blog2022 (2) TMI 1015X X X X Extracts X X X X X X X X Extracts X X X X ..... er was prepared on 09.04.2021. Moreover, the certified copy was obtained on 16.04.2021 because of the fact that 'Adjudicating Authority' was not functional till 14.04.2021, on account of various local Holidays and later, the instant Appeal was filed. Under these circumstances, the Appeal came to be filed with a delay of 13 days, which is neither wilful nor wanton, but due to the aforesaid reasons. 2. Taking note of the reasons assigned by the Applicant/Appellant in IA No.558/2021 in Comp App (AT)(CH)(Ins) No.261/2021, this 'Tribunal' on being subjectively satisfied in regard to the reasons ascribed, condones the delay of 13 days and allows the IA No.558/2021 in Comp App (AT)((c)(Ins) No.261/2021, in the interest of justice. No costs. INTRODUCTION 3. The Appellant/Axis Bank Ltd has preferred the instant Company Appeal (AT)(CH)(Ins) No.261/2021 being aggrieved against the order dated 05.02.2021 in IA 416/2020 in CP(IB)No.189/BB/2018 passed by the 'Adjudicating Authority'. 4. The 'Adjudicating Authority' while passing the impugned order dated 5th February, 2021 in I.A. No.416 of 2020 in CP. (IB) No.189/BB/2018 (Filed by the Applicant/Axis Bank Ltd under Section 42 read with Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /reiterate their claim again to Liquidator, but old claimants will reiterate their claim made earlier in CIRP, and fresh claimants, who have not availed opportunity during CIRP, can make their claim. It is relevant to point out here the Liquidation proceedings are part of insolvency proceedings initiated under the Provisions of Code and it is second stage of CIRP in respect of Corporate Debtor. Moreover, the Liquidator cannot ignore the decisions taken by IRP/'Resolution Professional' and reverse them except any new development takes place in such claims. Moreover, there cannot be two claims in respect of same debt. 8. As rightly pointed by the Learned Counsel for the Respondent, that if the Applicant is aggrieved by the decision of then IRP/'Resolution Professional', the Applicant has to take recourse to remedy by way of Appeal as provided under the provisions of Code within fourteen days of the receipt of such decision. It is not in dispute that 'Resolution Professional', as early as on 3rd March, 2020 replied to the Applicant stating that its claim has been updated on the website of the Corporate Debtor and stand rejected. Since the Liquidator has accepted the claims of Allott ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g it. 9. It is the version of the Appellant that its claim is nothing but a 'Debt' as defined under Section 3(11) of the I&B Code, as the same being a liability or obligation in respect of a claim which is due from any person as a 'Financial Creditor'. 10. The Learned Counsel for the Appellant projects an argument that the 'Adjudicating Authority' had failed to appreciate that the 'Corporate Debtor' had created 'lien' over the flats/units, which falls within the definition of security interest as per Section 3(31) of the Code and hence shall be considered as a 'secured creditor' as per definition 'secured creditor' under the Code. 11. The Learned Counsel for the Appellant points out that the 'Home Buyers/allottees' had subrogated all the rights under the 'Flats/Units' in favour of the Appellant and further that the Appellant is entitled to receive entire refund of its dues from the 'Home Buyers' in case of delay in construction of the flat/project as agreed in the Indemnity Letter/Bond executed by the relevant 'Home Buyers'. 12. The Learned Counsel for the Appellant contends that the substantial sum towards the cost of flats/units was financed by the Appellant, if any payment i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g dues would be recovered out of the sale of the flats/units by means of Recovery Certificate issued by the Debt Recovery Tribunal. 18. The Learned Counsel for the Appellant contends that the public funds are disbursed to the Corporate Debtor on behalf of the Home Buyers/allottees. To secure the loan numerous rights were given by the allottees/Home Buyers and the Corporate Debtor in favour of the Appellant under the loan/transaction documents. 19. The Learned Counsel for the Appellant submits that the Appellant had given the details of 13 allottees who had availed loan from the Appellant and that the Liquidator had submitted the details of only 10 allottees whose claims were accepted by him. 20. The Learned Counsel for the Appellant adverts to the fact that the Appellant had disbursed a substantial sum to those Allottees against the security of flats/units and it has a right to recover its money out of the sale of such flats/units. Therefore, it is the plea of the Appellant that in case of unattended claim, the claim filed by the Appellant should be considered. Otherwise, the 'Appellant' would neither be recovering its loan sum nor security protecting its rights and interests u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is yet to be made and no person ought to be deprived of its legal right, if no prejudice will be caused. APPELLANT DECISIONS 27. The Learned Counsel for the Appellant seeks in aid of the order passed by the Adjudicating Authority/NCLT Chennai Bench in Mangalam Cotton Industries V. GV Ravikumar Liquidator of Thirupur Surya Textiles Pvt Ltd (Manu)/NC/0770/2021 15. It must be borne in mind that the IBC treats the CIRP and Liquidation process as two separate stages and the proof of claim is to be filed separately at each stage and hence the submissions of the Learned Counsel for the Applicant that claims filed during CIRP should be treated as the Claim filed during the Liquidation process would render the CIRP and Liquidation Process as envisaged under the provisions of IBC, 2016 as nugatory. "13. It is to be noted here that the provisions of IBC, 2016 mandates that the Claimants are required to submit the claim to the Liquidator in such form and in such manner along with such supporting documents as specified by the Board. Thereafter, upon submission of the claim, the Liquidator is required to verify the claims within the time limits specified by the Board and in this connection ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Liquidator. 33. The Learned Counsel for the Respondent submits that the Allottees and the 'Corporate Debtor' had entered into an agreement to Sell wherein it was mentioned that the 'Allottees' will pay the consideration to the 'Corporate Debtor' and that the 'Corporate Debtor' shall construct and deliver the property to the respective Allottees. 34. The Learned Counsel for the Respondent refers to the Clauses of the 'Agreement to Sell' which runs as under:- "3. The Purchaser's shall pay a sum of Rs. 1,05,45,000/- (Rupees One Crore five lakhs forty five thousand only) towards the cost of Schedule 'C' property which amount exclude the cost of Schedule 'B' property. The same shall be payable by the PURHASER'S to DEVELOPER as per the payment of schedule agreed under the agreement. Further, it is agreed that apart from the aforesaid amount shall also pay the additional cost/deposit/fees/charges/expense as more fully states at para 15 of this agreement. 4. That the DEVELOPER shall construct and deliver the SCHEDULE 'C' PROPERTY to the PURHASER'S in accordance with the specific contained in the Schedule 'D' here to or equivalent thereof. The DEVELOPER agree to deliver the Sch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ower, declare all sums outstanding under the Loan (including the principal, interest, charge, expenses) to became due and payable forthwith and exercise any or all of the following rights in addition to statutory rights that may be available to the Bank from time to time." and puts forward a plea that the amount was disbursed by the Bank to the respective allottees based on the Loan Agreement and a time value of money relating to instalment is in respect of 'Borrower Allottee' and not the 'Corporate Debtor'. 35. The Learned Counsel for the Respondent adverts to the following clause in respect of a Tripartite Agreement executed between the Bank, Allottee and the Corporate Debtor and the same is as follows: "In consideration of BUILDER and the Borrower's performing their obligation under the agreement executed between them, the third party i.e. Bank has agreed to give a loan of Rs.........(Rupees.................only) to the Borrower in terms of the loan sanction letter dated..../..../2016 and on payment of interest, processing fee, administration fee etc on agreed contractual." 36. The Learned Counsel for the Respondent submits that a cumulative reading of the 'Agreement to Sel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r'. 41. The Learned Counsel for the Respondent proceeds to point out that the Liquidator pursuant to his appointment made public announcement in Form B of Schedule II and because of the Covid 19 pandemic and by virtue of the insertion of Regulation 47 A in the Liquidation Regulations, the time for filing claims against the 'Corporate Debtor' before the 'Liquidation' was extended till 22.06.2020 by the Liquidator. 42. The Learned Counsel for the Respondent submits that the Appellant/Applicant through its Email dated 21.05.2020 furnished its claim before the Liquidator in Form B as a Financial Creditor of the 'Corporate Debtor' and after verification of claims submitted by the Appellant/Applicant etc the claim of the Appellant was rejected and the same rejection of claim filed by the Appellant against the Corporate Debtor was communicated through Email 2.9.2020 and 5.9.2020. 43. The Learned Counsel for the Respondent submits that the Application in IA 416/2020 in CP (IB) No.189/BB/2018 before the Adjudicating Authority (NCLT Bengaluru Bench) is a misconceived one besides the same being untenable in Law and hence the impugned order of adjudicating authority in dismissing the afores ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent is made for consideration of time value of money, a person can claim to be a financial creditor with regard to amount paid. 6. Admittedly the appellant, IHFL, has disbursed the amount for consideration of time value of money in favour of borrower, Mr. Devender Singh and not to the builder. Therefore, the Adjudicating Authority has rightly held that Rudra Buildwell Projects Pvt Ltd is not the corporate debtor of the appellant and the application under Section 7 of I&B Code is not maintainable. 7. In absence of any merit, the appeal is dismissed. No costs." 46. This Tribunal has heard the Learned Counsels appearing for the respective parties and noticed their contentions. ASSESSMENT 47. It is to be pointed out that I&B Code, 2016 envisages a time frame for completion of the Insolvency Resolution Process in a time bound manner. The CIRP and the 'Liquidation Process' are to be completed within the specified time period. Further, in the instant case, the Appellant when it questions the determination of the Liquidator dated 05.09.2020 to the effect that the Appellant/Applicant is not a 'Financial Creditor', then, as per Section 42, in respect of the accepting or rejecting the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... While determining the issue of priority, all questions of Law of facts arising out of an order pertaining to the Insolvency Resolution, an 'Adjudicating Authority' is to follow the procedural aspects mentioned in the numerous provisions of the Code, of course, depending on the issue which arises for its rumination. 52. In the present case, the rejection of the claim was duly communicated to the Appellant through Email dated 02.09.2020. The 'Appellant' had not questioned the rejection of the Resolution Professional in rejecting the claim of the 'Appellant'. It cannot be forgotten that in the case on hand the Allottees had approached the Appellant/Applicant for the financial assistance which was disbursed by the Appellant as Loan amounts to the respective Allottees which was then disbursed by the Allottees to the 'Corporate Debtor'. The Appellant has not subjectively satisfied this Tribunal that the money which it is claiming was disbursed to the 'Corporate Debtor' for time value of money as per Section 5(8) of the I&B Code. Undoubtedly, the Appellant in 'Law' has a valuable right to proceed against the Allottees in the light of numerous documents executed between them. 53. In vie ..... X X X X Extracts X X X X X X X X Extracts X X X X
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