TaxTMI 
TaxTMI 
2017 (12) TMI 1798
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....Srikanta Sarda/petitioner. The petitioner, Smt. Srikanta Sarda alleged that she had sanctioned a cash loan of five lakh to the respondent as per a letter dated 17.08.2016 issued by the respondent duly signed by its director Mr Mukesh Kumar Singal. The above-said letter allegedly is a promissory note. A copy of the said promissory note is produced, marked and annexed as ' Exhibit-B". 3. The petitioner further alleged that vide Exhibit-B the respondent promised to repay the above-said amount after enjoying it for four months. According to the petitioner since the respondent defaulted repayment of the amount as promised it is liable to pay the amount with interest @15% p.a and that despite repeated demand notice respondent failed to repay the amount as per the terms agreed in between them and as stipulated in the said agreement. 4. The copies of written demand notice dated 28.01.2017 and 24.02.2017 send to the respondent recalling the loan amount with interest are produced, marked and annexed as ' Exhibit-C and D'. 5. The petitioner further alleges that the consent of the Interim Resolution Professional Mr Ajay Gaggar, (IP Reg. No: IBBI/IPA-OOI/IP- P0003C/2016-201....
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....bove said Exhibit-R. This petition was filed on 1st August,2017. 10. Ld. Counsel for the petitioner at this juncture, brought to our notice Exhibit - A filed along with the petition. Exhibit-A is a similar copy of Company Master Data downloaded on 16th June,2017. A reference of Exhibit-A shows that as on 16/6/2017 the company of the respondent was active. However, on a reference of Exhibit-R, dated 10/11/2017 the respondent company status is shown as Strike off. When exactly the respondent company's name was removed from the Company Master Data maintained by the MCA, is not certain. Even on a comparison of exhibit-R and A we cannot assume the exact date of removal of the respondent's name from the Master Data. 11. A reference of Exhibit-A only shows that as on 16/6/2017 the Company status is recorded as active. However. Ld. Counsel for the respondent when entered appearance on behalf of the respondent produced a copy of resolution dated 20/10/2017 purported to be issued by the Board of Directors of the respondent company authorizing Ld. Counsel for the respondent for appearing before this Tribunal for and on behalf Of the respondent Company. 12. A reference of the ....
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....orm No. I of this petition. So, a question arose as to whether Exhibit-B is a promissory note as alleged by the petitioner. A promissory note is defined under Sec.2 (22) Of The Indian Stamp Act, 1899. It reads as follows: "Ptomissory note" means a promissory note as defined by the Negotiable Instruments Act, 2882 (26 of 1881): It also includes a note promising the payment of any such of money out of any particular fund which may or may not be available, or upon any condition or contingency which may or may not be performed or happen." 16. As per Rule 5 of West Bengal Stamp Rules, 1994, a " promissory note or a bill of exchange shall, except as provided by section Il of The Indian Stamp Act, or by proviso to clause (a) of sub-me (I) of rule 4 or rules 13 and 17, be written on paper on which a stamp of the proper value, not bearing the word " hundi" has been engraved or embossed' . As per section 11 of the Indian Stamp Act, a promissory note may be stamped with adhesive stamps. What is required for constructing Exhibit-B as a Promissory note is that it should contain written promise by one party to pay another party an advance sum of money either on demand or....
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....ence, but Plaintiff/Respondent was entitled to get relief and entitled to sue on original debt and adduce other evidence in support thereof. When the above-said order was challenged before the Hon'ble division bench, the Hon'ble bench has confirmed the above-said judgment of single bench. Bear in mind the above-said proposition no doubt the relief based on unstamped promissory note also cannot be entertained by this Tribunal. 22. The next contention of the petitioner is that she is a financial creditor and the debt claimed by her is a financial debt. The financial creditor is defined under Sec. 7 of the I & B Code. A financial creditor means, " any person to whom a financial debt is owed and includes a person to whom such debt has been legally assigned or transferred to. " To maintain a petition of this nature by a financial creditor, the debt claimed by the petitioner could be a financial debt. 23. Thus, the question is whether the money allegedly liable to pay by the respondent is a financial debt as per section 5 (8) of I&B Code. It is good to read the definition of financial debt. Sec. 5 (8) defines financial debt as follows: " financial debt"....
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....us of a financial debt as defined under Sec.5 (8) above referred, a transaction should have consideration for time value of money, which is a substantive ingredient for fulfilling requirement of the expression financial debt. AS per Sec .5 (8)(a) money borrowed would be against the payment of interest; No documents produced and relied upon by the petitioner proves the contention of the petitioner that respondent is liable to pay back the money it received with interest as claimed by the petitioner. 26. What is the nature of the transaction is known to both the lender and the borrower. Whether it is a loan or gift is also not certain. Whether it is a bonafide commercial transaction is also not certain. Truly a loan come with promissory notes. Usually a loan given on execution of promissory note, it requires that interest be paid on lent money. When a payee lent money for getting back the same with interest the lender IS bound to make sure it spells out how much interest must be paid and sets out a schedule for payments, In the given Exhibit-B, no such factors expressly or impliedly included. 27. In the case of Nikhil Mehta and Sons (HUF) v. AMR Infrastructures Ltd., [2017] 137....
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....te the word used by the petitioner in Ext.B). n view of the above said discussion, it appears to us that Exhibit-B is neither a promissory note, nor a receipt as alleged in Form I and that Exhibit-d has not acquired the status of a financial debt. So also, it does not have consideration for the time value of money. Accordingly, we hold note, nor a receipt as alleged in Form 1 and that Exhibit-B has not acquired the status of a financial debt. So also, it does not have consideration for the time value of money. Accordingly, we hold that the debt clairned by the petitioner in the instant case is not a financial debt and, therefore, the claim of the petitioner that the debt claimed by her is a financial debt is also found devoid of any merit. This point is answered accordingly. Point No.3 and 4 31. Both these points are taken together for convenience and for avoiding repetition of facts. This is an application filed under Sec. 7 for initiating insolvency resolution process against the respondent. Petitioner alleged that the despite repeated demand respondent did not repay the money and produced Exhibit-C dated 28/1/2017 and Exhibit-D dated 24/2/2017 for proving that the petition....