TaxTMI 
TaxTMI 
2017 (8) TMI 1568
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....erence No. ETTS 1959 on the first floor in the project Earth Titanium Studios developed by Respondent Company at GreaterNoida, UP. The MOU contains an express promise made on behalf of the Respondent Company for guaranteed a returned on the investment and has been styled as 'commitment amount' till the actual possession is delivered. The total sale consideration for the flat was Rs. 20,80, 000 plus taxes. The possession of the flat was to be delivered in September 2016. On the date of signing of the MOU part payment of sale consideration alongwith service tax was paid and Respondent Company had undertaken to make payment of commitment of amount of Rs. 20,000/-per month and it was to increase with the payment of the next instalment. The last instalment of the sale consideration was payable in May 2015. Eventually the applicants have paid the entire agreed sale consideration plus taxes. The Respondent Company paid the commitment amount to the applicants till February 2016 and has stopped paying the same subsequently. 28. The facts of the instant case are akin to those of a decided, case in material particulars namely Nikhil Mehta & Sons (HUF) & Ors. V. M/s AMR Infras....
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....or obligation in respect of a claim which is due from any person and includes a financial debt and operational debt;" 23. From the 'Annual Return' of the Respondent and Form- 16A, we find that the 'Corporate Debtor' treated the appellants as 'investors' and borrowed the amount pursuant to sale purchase agreement for their commercial purpose treating at par with 'loan' in their return. Thereby, the amount invested by appellants come within the meaning of 'Financial Debt', as defined in Section 5(8)(f) of I & B Code, 2016 subject to satisfaction as to whether such disbursement against the consideration is for time value of money, as discussed in the subsequent paragraphs. 24. Learned Adjudicating Authority has rightly highlighted the opening word of the definition clause which indicate that a 'financial debt' is a debt along with interest which is disbursed against the consideration for the time value of money and may include any of the events enumerated in sub-clause (a) to (i). Therefore, it is to be seen whether the amount paid by the appellants to the Corporate Debtor, fulfil the other condition of "disbursement ag....
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....t as quoted above, but failed to appreciate the nature of transactions in the present case and wrongly came to a conclusion "that it is a pure and simple agreement of sale and purchase of a piece of property and has not acquired the status of a financial debt as the transaction does not have consideration for the time value of money". 6. The judgment passed by Ld. Adjudicating Authority in the case of "Nikhil Mehta and Sons v. AMR Infrastructure Ltd" was set aside and matter has been remitted back to the Ld. Adjudicating Authority for admission. 7. Notice was issued on respondents both by Speed-post and e-mail. In spite of service of notice both by Speed-post and e-mail, the Respondent- Corporate Debtor refused to appear. 8. From the agreement/ Memorandum of Understanding dated 14th May, 2014, we find that the said agreement relates to the allotment of apartment .admeasuring 520 sq. ft., therein the following terms and conditions of payment (commitment amount) has been stipulated and agreed between the parties: - "The Company hereby undertakes to make a fixed payment of Rs. 13,000/- (Rupees Thirteen Thousand only (hereinafter referred to as the 'Commitment Amo....
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....501 Total: 1,754,740,593 1,008,172,187 1,764,825,748 1,018,244,845 10. In the end of the said Balance Sheet, against the Note 8 "other current liabilities" have been shown as quoted hereunder: Particulars As at 31 March 2015 Rs. As at 31 March 2014 Rs. (a) Other payables (i) Statutory Remittance Duties & Taxes) 5,783,392 5,548,820 (ii) Others (a) Advance from Customer 1,729,554,149 860,069,589 (b) Retention 227,042 31,274 (c) Book Overdraft 8,138,140 (d) Expenses Payable 4,771,472 2,100,208 Total: 1,748,474,195 867,749,891 *Represents advances adjustable against sale consideration of shops/plots/office/flats net of debtors adjustable against sale consideration of shops/plots/flats etc. and are generally not refundable. It also includes amount credited toward commitment charges paid/payable. *The amount of Rs. 1,35,09,464 (PVR Rs. 17,80,000) was being directly deposited into the bank account of the company, which are not identifiable by the company." 11. In the presen....