TaxTMI 
TaxTMI 
2018 (9) TMI 851
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.... on 29.12.1998. The identification number of the Corporate Debtor given is CIN U15203DL1998PLC097690 and its registered office is situated at 303, Vardhman Chamber, 3rd Floor, Sonia Complex, Vikas Puri, New Delhi - 110018. The authorised share capital of the company is Rs. 11,00,00,000/- (Rupees Eleven Crore only) and the Paid-up share capital is Rs. 10,10,00,000/-(Rupees Ten Crore Ten Lakhs), respectively. 3. The precise case of the Petitioners is that the financial debt to the tune of Rs. 45,80,000/- (Rupees Forty-Five Lakhs Eighty Thousand only) has accrued in favour of the Financial Creditors on account of their investments under the Investment Scheme floated by the Corporate Debtor along with total sum of Rs. 91,60,000/- (Rupees Ninety One Lakhs Sixty Thousand only) payable as assured return to the Financial Creditors on expiry of the term. The term has ended as per details provided in the Annexure A-5, but the Financial Creditors have not been paid, till date. 4. The Corporate Debtor is engaged in the business of dairy farming and trading of its products. The Corporate Debtor used to invite applications from customers/investors for the purchase and upbringing of the cat....
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....lt have been disclosed in Annexure A-5 which is based on the certificates issued by the Corporate Debtor. Thus the date of default is 29.03.2017 (which is the maturity date as per the Scheme). 9. It is the case of the Petitioner(s) that the Corporate Debtor was inviting applications from customers/investors for the purchase and upbringing of the cattle under its investment scheme by issuing a 'Rule Book', Application Form, Certificate, Receipt, etc. 10. That, the 'Rule Book' shows different types of cattle available with the corporate debtor/company and their estimated cost and the same is given in the table as below: Sl. No. Type of Cattle Qty. of Milk Ltr. (per day) Estimated Cost 1 Brown Swiss 5-10 5,000-15,000 2 KarnFreeje 12-30 15,000-30,000 3 H.F.R./H.F. 15-35 15,000-35,000 4 Jerses 15-45 15,000-45,000 5 Claf M/F 2,500-10,000 Under the 'Rule Book' there are two categories of Plans offered by the Corporate Debtor/Company as Categories I and II. In Category I plans, the payments by the customers/investors are made in lump sum, whereas in Category II plans the payments by the customers....
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....f company. (8) Joint Venture(s) shall be repaid on expiry of terms. That application form also mentions category Plan No., Term of Plan, Consideration of CV, Date of Commencement, Expiry date of Joint Venture, Mode of Payment, total amount etc. It is noted from the 'application form' that the same does not speak anything about the cattle. The salient features as discussed above categorically states that the Joint Venturer shall be repaid only after the expiry of the term. The date of expiry in the case in hand for different Joint Ventures is different as disclosed in Annexure A-5. However the default occurred for different Joint Ventures between 29.03.2017 to 30.06.2018. 13. It is seen that the Company issues 'a certificate' against the investment taken from the customers/investors. The sample certificate mentions as under; "CERTIFIED that the person described in Schedule hereto is Registered Joint Venture of Consideration as shown in Schedule under Plan of Company, subject to the regular payment of Subscription(s) as mentioned in the said Schedule and also subject to "General Terms and Conditions" printed overleaf and Terms and Conditions as per Rule Book, as may....
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....e Corporate Debtor for the payment of expected maturity amount. However, the Corporate Debtors had retained original certificate with the purport to release the assured return of the Financial Creditors. However, Corporate Debtor has wilfully failed to pay the assured return amount of the Financial Creditors, till date. 17. The Applicants submit that several reminders were sent and they visited the Corporate Debtor and its officials but no response has ever been received by the Applicants/Financial Creditors to the said request. In fact, there is deafening silence. 18. Further, the Securities and Exchange Board of India (hereinafter referred to as 'the SEBI') received a reference from Reserve Bank of India ('RBI') as a complaint against the Corporate Debtor alleging illegal mobilization of funds from public under the garb of various schemes. The SEBI initiated inquiries into the scheme and issued a Show-Cause Notice alleging that the Schemes run by Corporate Debtor are in the nature of Collective Investment Schemes (CIS) as defined in Section 11AA of the SEBI Act without obtaining a certificate of registration from SEBI for operating CIS as required under SEBI regulations. ....
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....017. A copy of order dated 29.09.2017 bearing No. RO/NRO/84/2017 of Recovery Officer, Securities And Exchange Board of India, Northern Regional Office, New Delhi has been annexed (Annexure-A-13). 25. Respondent-Corporate Debtor has filed its reply and has raised various objections to the petition. 26. A rejoinder to the reply/written statement has been filed by the Financial Creditor reiterating the submissions made in the application and controverting the assertions in the reply/written statement. 27. The objection of the Respondent-Corporate Debtor is that first and foremost the Petitioners are the Joint Venturers with the corporate debtor and thus they cannot term and/or classify themselves in the category of Financial Creditors under the provisions of the I & B Code. In this regard the Petitioners have submitted in their Rejoinder filed on 02.07.2018 and have denied that the petitioners were the Joint Ventures with the Respondent-Corporate Debtor. It is submitted that as per the direction of the SEBI & the SAT, the Corporate Debtor had defaulted in making payment due to the Financial Creditors as well as other investors and thus, dues of Financial Creditor have b....
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....f the claim as mentioned in Form 1 submitted along with the Petition. Further the Petitioner- Financial Creditor has relied on the Judgment of the Hon'ble Supreme Court in a similar matter in Civil Appeal No. 20974/2017 titled as 'Anant Kajare v. Eknath Aher' wherein the SEBI has classified the scheme floated by a company called 'Royal Twinkle Star Club Limited, as a "Collective Investment Scheme" (CIS) and later the same has been proceeded to the SAT, as well. 29. It is also submitted by the Respondent-Corporate Debtor in its reply that this application is not maintainable on the grounds that the company was forced to stop its operations in the year 2013, much before the coming into force of the IB Code and the petitioners cannot claim similar reliefs from two Authorities as by the orders of SEBI and SAT, the title deeds of the fixed assets of the Corporate Debtor are in possession of SEBI and its Bank accounts are also lying freezed. The Petitioner-Financial Creditor in its rejoinder has outrightly denied the above averments made and states that the SEBI in its order dated 12.02.2015 has observed that the Corporate Debtor has been continuously collecting money from its inve....
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....as published a Notice for Sale of certain Properties through its website. A copy of the e-Auction Notice as downloaded from the website has also been enclosed with the application. The aforesaid objection raised by corporate debtor would also not require any serious consideration because all transactions which have taken place before the admission of the petition are liable to be considered by the IRP/RP and it would not constitute a ground to refuse the admission of the petition. Therefore we are not impressed with the objection raised and reject the same. 32. Under sub-section 5(a) of section 7 of the code, the application filed by the applicant financial creditor has to be admitted on satisfaction that: (i) Default has occurred; (ii) Application is complete, and (iii) No disciplinary proceeding against the proposed IRP is pending. 33. Learned Counsel for the petitioner has argued that all requirements of Section 7 of the Code for initiation of Corporate Insolvency Resolution Process by a Financial Creditor stand fulfilled. In that regard, he has submitted that the application is complete as per the requirements of Section 7 (2) of the Code and....
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....ately make public announcement with regard to admission of this application under Section 7 of the Code. We also declare moratorium in terms of Section 14 of the Code. A necessary consequence of the moratorium flows from the provisions of Section 14 (1) (a), (b), (c) & (d) and thus the following prohibitions are imposed which must be followed by all and sundry: "(a) the institution of suits or continuation of pending suits or proceedings against the corporate debtor including execution of any judgment, decree or order in any court of law, tribunal, arbitration panel or other authority; (b) transferring, encumbering, alienating or disposing of by the corporate debtor any of its assets or any legal right or beneficial interest therein; (c) any action to foreclose, recover or enforce any security interest created by the corporate debtor in respect of its property including any action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002; (d) the recovery of any property by an owner or lessor where such property is occupied by or in the possession of the corporate debtor." 38. It is made cle....