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TMI Blog2018 (12) TMI 1945X X X X Extracts X X X X X X X X Extracts X X X X ..... t is that the money was disbursed against the consideration of time value of money which does not exist in the present case. The learned counsel for the petitioner relied upon the judgment of Hon ble National Company Law Appellate Tribunal, New Delhi in NIKHIL MEHTA AND SONS VERSUS AMR INFRASTRUCTURE LTD. [ 2017 (8) TMI 1017 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI ] in support of his contention. The facts of that case are quite different. In the said case the petitioner entered into different agreements/MOU with the Company (corporate debtor) for purchase of 3 units being a residential flat, shop and office space in the projects. That was therefore the case of a home buyer. It was further observed that the question whether the appellants came within the relevant clause of one of the Memorandum of Understanding dated 12.04.2008. In the said case the Investor was interested in booking of a shop for a total consideration amount of 46,67,402/- and the mode of payment by cheque was also mentioned. The relevant term of Memorandum of Understanding was that most of the consideration paid as on 19.03.2008 by the Investor was on the condition that the Developer was ready ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , Member (Technical For the petitioner : Dr. Sumant Bhardwaj, Advocate JUDGMENT Per: Justice R.P.Nacjrath, Member (Judicial) This petition has been filed by M/s Jagbasera Infratech Pvt. Ltd., a Company incorporated on 29.08.2011 under the Companies Act, 1956, under Section 7 of the Insolvency and Bankruptcy Code, 2016 (for short to be referred hereinafter as the Code ) for initiating the insolvency resolution process against the respondent-corporate debtor. The petitioner-financial creditor passed a resolution dated 07.05.2018 authorising Mr. KushalVir Singh Rana, Managing Director cum Shareholder of the company to sign and verify the pleadings, appoint and engage advocates, solicitors or Company Secretaries and to do all the necessary acts in progress of the case. 2. The petitioner has filed application in Form No.1 as prescribed n Rule 4(1) of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules 2016 (for brevity the Rules ). The contents of the application are supported by the affidavit of Mr. KushalVir Singh Rana, the authorised signatory. The authorised and paid up share capital of respondent-corporate debtor is 5,00,000/- as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... can prima facie be covered within the definition of term Financial Creditor . The term Financial Creditor is defined in sub-section (7) of Section 5 of the Code as meaning any person to whom a financial debt is owed and includes a person to whom such debt has been legally assigned or transferred to. The term Financial Debt is defined in sub-section 8 of Section 5 of the Code and the relevant part of the provision upon which the learned counsel for the petitioner has relied upon during arguments and also stated in the synopsis to the original petition is sub-section 8(f) of Section 5 of the Code. The relevant provision reads as under: Financial Debt means a debt along with interest, if any, which is disbursed against the consideration for the time value of money and includes- (a) . to (e) (any amount raised under any other transaction, including any forward sale or purchase agreement, having the commercial effect of a borrowing; Explanation has also been added to Clause (f) of Section 5(8) by way of Amendment Act 26 of 2018 with effect from 06.06.2018 and it reads as under: Explanation - for the purposes of this sub-clause, (i) any amount raised fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith the agreement. The respondent was entitled to engage architects, engineers etc. and to pay them emoluments, fee, charges and responsible for observance/compliance of all the rules and regulations governing employment; (ii) the respondent was further solely responsible for any of the acts done by its labour, workers etc.; (iii) on confirmation of acceptance of the plans and subject to approval of Himachal Pradesh Housing Urban Development Authority, the petitioner was to commence the marketing and booking of the residential plots; (iv) it shall be the responsibility of the respondent to complete the construction and development of the project; (V) the petitioner has sole rights to grant maintenance rights to the petitioner. The petitioner was entitled to raise the loans in its own name from the bank/financial institutions for the project and there was also the arbitration clause between the parties. 10. The payment schedule has been specified in Annexure-Il attached with the agreement as at page 27 of the paper book which is as under: First Payment Schedule (0 to 180 days) this schedule s flexible as per Developer/Promoter convenience 25% of total has to be paid in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of that case are quite different. In the said case the petitioner entered into different agreements/MOU with the Company (corporate debtor) for purchase of 3 units being a residential flat, shop and office space in the projects. That was therefore the case of a home buyer. The Hon ble Appellate Tribunal observed that following essential criterias are required to be fulfilled for a Creditor to come within the meaning of Financial Creditor : (i) A person to whom a Financial debt is owed and includes a person whom such debt has been legally assigned or transferred to (ii) The debt along with interest, if any, is disbursed against the consideration for time value of money and nclude any one or more mode of disbursement as mentioned in clause (a) to (i) of sub-section (8) of Section 5. 15. It was further observed that the question whether the appellants came within the relevant clause of one of the Memorandum of Understanding dated 12.04.2008. In the said case the Investor was interested in booking of a shop for a total consideration amount of 46,67,402/- and the mode of payment by cheque was also mentioned. The relevant term of Memorandum of Understanding was that most of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion that the amount was disbursed against the consideration of time value of money has not been established. 19. However to fortify his contention, learned counsel referred to the explanation to sub-clause (f) of Section 5(8) of the Code as brought by way of amendment. It says that any amount raised from allottee in real estate project shall be deemed to be an amount having a commercial effect of the borrowing. The fact that project is real estate project as defined in sub-clause (Zn) of Section 2 of the Real Estate (Regulation and Development) Act, 2016 (RERA) cannot be doubted but the question here is whether the petitioner can be treated as an Allottee for taking advantage of the explanation to sub- clause (f) of Section 5(8) of the Code. 20. The term Allottee is defined in clause (d) of Section 2 of RERA Act. It says that allottee in relation to a real estate project, means the person to whom a plot, apartment or buildings, as the case may be, has been allotted, sold (whether as freehold or leasehold) or otherwise transferred by the promoter, and includes the person who subsequently acquires the said allotment through sale, transfer or otherwise but does not include a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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