TaxTMI 
TaxTMI 
2026 (1) TMI 1357
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....al passed an interim order on 31.03.2023 staying further proceedings till the next date which interim order continued from time to time. Contempt Case (AT) No.32 of 2024 has been filed alleging non-compliance of interim order dated 31.03.2023 passed in the Appeal as clarified on 24.07.2024. Company Appeal (AT) (Insolvency) No.386 of 2023 2. Brief facts giving rise to the Company Appeal are as follows:- 2.1. Corporate Debtor- 'Harihar Infra Venture (India) Pvt. Ltd.' launched a project namely-'Sai Hermitage'. Respondent Nos. 1 to 6 entered into an agreement with the Corporate Debtor between the year 2016 to 2017 by which different flats were allotted. Appellant claimed to have also made payment of their consideration. Possession of flats were to be provided on or before 30.04.2019. The Respondents on suggestion of the Corporate Debtor entered into Leave and License Agreement with the Corporate Debtor in respect of flats allotted to them under which in order to compensate the Financial Creditors who have paid full consideration providing for payment of license fee to the Financial Creditors. The Corporate Debtor stopped making payment to the Financial Creditors, hence, Compa....
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....hat Leave and License Agreement was entered at the instance of the Corporate Debtor under which the Financial Creditors were to the paid license fee by the Corporate Debtor. It is denied that the Respondent Nos.1 to 6 are speculative investors. The Appellant has raised the above submission for the first time as an afterthought. Refuting the submission of the Appellant that application under Section 7 is not maintainable due to default in the Consent Terms, it is submitted that merely on account of entering into Settlement Agreement/ Consent Terms original debt is not wiped out and the nature of transaction remains the same, thus, the Respondent Nos.1 to 6 are Financial Creditors. Refuting the submission of the Appellant that the Application does not meet the threshold under Section 7(1) 2nd proviso of the IBC, it is submitted that the Corporate Debtor in its reply has not given any details of units which according to the Corporate Debtor has been allotted. No details have been given in the reply and it was only in the written submission for the first time Corporate Debtor mentioned that there are 112 allotments. Any statement in the written submissions could not be relied. It is su....
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.... Mrs. Korutla Vijaya Lakshmi 8th May, 2017 28,00,000/- 119, Ground Floor, Block E 5 Mr. Krishna Rao Veliventi 3rd October, 2016 23,00,000/- 119, Ground Floor, Block A 6 Mrs. Girija Kumari Emani And Emani Sankar Rao 7th February, 2017 23,00,000/- 307, 2ND Floor, Block A 4. Pertinently, the Financial Creditors paid the entire consideration as mentioned in the Agreements to the Corporate Debtors. The consideration was paid on the following dates: Sr. No. Financial Creditor Consideration Amount Date of Payment 1 Mr. Srikanth S. Despande and Mrs. Indira Sripath Rao 28,00,000/- 30th December, 2016 2 Mrs. Kakumanu Lakshmi 23,00,000/- 9th December, 2016 3 Mrs. Veliventi Venkata Gayathri Sowmva 28,00,000/- 18th April, 2017 4 Mrs. Korutla Vijaya Lakshmi 28,00,000/- 8th May, 2017 5 Mr. Krishna Rao Veliventi 23,00,000/- 3rd October, 2016 6 Mrs. Girija Kumari Emani And Emani Sankar Rao 23,00,000/- 7th February, 2017 8. In the reply which was filed by the Corporate Debtor in which reply the status of applicants have not been disputed. Agreement between the parti....
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....to 6 as they being speculative investors. 10. The 2nd submission which has been pressed by the Appellant is that on breach of Consent Terms, application under Section 7 cannot be filed. As noted above, Consent Terms between the parties were entered in the first company petition which was filed by the Financial Creditors being Company Petition No.2910 of 2019. The 1st Company Petition was filed by Respondent Nos.1 to 6 claiming the Financial Creditors in Class in which the default was claimed on the part of the Corporate Debtor. The default on the Corporate Debtor being accepted fact the Corporate Debtor entered into Consent Terms with the Respondent Nos.1 to 6 in the Company Petition. Agreeing to pay the outstanding amount to the Financial Creditors, post-dated cheques were issued. The amount which was acknowledged to be paid in the Consent Terms was amount arising out of the allotment letters issued in favour of the Respondent Nos.1 to 6. Counsel for the Respondent has rightly relied on the judgment of this Tribunal in "Desh Bhushan Jain vs Abhay Kumar- Company Appeal (AT) (Insolvency) No.124 of 2024" wherein in the earlier CIRP, Corporate Debtor approached for settlement and a....
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....d by the Appellant about the amount of Rs. 87 Lac. which has been paid out of the court during the pendency of this appeal to be adjusted in the amount which is stated to be due is concerned, suffice it to say that the Appellant has not brought on record any writing/agreement in this regard that the said amount has been paid towards the adjustment of the principal amount otherwise the Financial Creditor is entitled to adjust the amount towards the payment of interest component at the first instance. 22. Thus, in view of the aforesaid facts and circumstances, we do not find any merit in the present appeal and the same is hereby dismissed. The amount deposited by the Appellant in this court by way of FDR is ordered to be returned to the Appellant within a period of one month from the date of passing of this order by the Registrar after due verification." 11. It is a nature of transaction which determines the maintainability of the application. When Respondent Nos.1 to 6 have filed Section 7 application claiming to be an allottee of the Corporate Debtor, the mere fact that in earlier Company Petition, a settlement was entered by Corporate Debtor which settlement has been b....
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....ithin thirty days of the commencement of the said Act, failing which the application shall be deemed to be withdrawn before its admission.] Explanation. - For the purposes of this sub-section, a default includes a default in respect of a financial debt owed not only to the applicant financial creditor but to any other financial creditor of the corporate debtor " 13. Earlier Section 7 application was filed by Respondent Nos.1 to 6 when above amendment had not come and in earlier Company Petition, Consent Terms were entered on 01.12.2019, the subsequent petition was filed in the year 2021 by which amendment has already been made in Section 7. In the reply which was filed by the Corporate Debtor in paragraph 12, objections was taken by the Corporate Debtor that there is non-compliance of threshold limit as prescribed under Section 7(1) and the applicants (6 individual) do not constitute the threshold of 100 homebuyers or of 10% of the total homebuyers. In paragraph 12 of the reply, following has been pleaded:- "12. Admittedly, the instant Petition under Section 7(1) of the Code has been filed by 6 Applicants claiming themselves to be the Financial Creditors (in th....
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....ist of 81 allottees/homebuyers with whom the registered Agreement(s) to Sale executed with the Corporate Debtor in respect of the project Sai Hermitage is annexed herewith and marked as Annexure A-2." 16. In the Appeal, Appellant has brought on the record certain information as available in Maharashtra RERA application. It appears that that record was not before Adjudicating Authority. Counsel for the Respondent submitted that even as per the record, which was brought by the Appellant, of Maharashtra RERA, in the information pertaining to number of allotment, the number of booked allotment figure has been mentioned as zero. The submission of the Respondent that information as available in Maharashtra RERA, the booked allotment is mentioned as zero is not even as per the case of the Appellant who claims 6 allottees of the project. Respondent further submits that at best there are 54 units only. 17. Now we come to the impugned order where the Adjudicating Authority has dealt with the said contention. In paragraph 25 of the impugned order, the Adjudicating Authority has dealt with the submission of the Corporate Debtor that the condition precedent to file....
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....r initiating CIRP against the Corporate Debtor shall be filed jointly be not less than one hundred of such allottees under the same real estate project or not less than 10% of the total number of such allottees under the same real estate project whichever is less, is thus statutory requirement. The Adjudicating Authority had to record a positive finding that number of allottees who have filed the application does meet the threshold as required by 2nd proviso of Section 7(1). 19. In the facts of the present case especially the fact that certain materials which have been brought by both the parties in the record of this Appeal which were not available before the Adjudicating Authority, ends of justice be served in remanding the matter to the Adjudicating Authority for fresh consideration of the question as to whether application filed by Respondent Nos.1 to 6 meet the threshold as required by Section 7(1) 2nd proviso. We grant liberty to the Corporate Debtor to file an additional affidavit bringing on record all relevant materials which it relies with respect to number of units allotted in the project within three weeks from today. Respondent Nos. 1 to 6 are also allowed three wee....