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2020 (11) TMI 585 - AT - Insolvency and BankruptcyMaintainability of application - sale of paratments - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditor or not - provisional allotment of an under construction of apartments - Whether in view of the I&B Code (Amendment)Ordinance 2019/Amendment Act, 2020, the Application under Section 7 of the I&B Code by one allottee is not maintainable? - HELD THAT:- The provision of Section 7 of the I&B Code, as is obtained prior to the date of Amendment occupies the field as of now. Thus, we hold that there is no effect of the I&B Code, Amendment Ordinance 2019 which was replaced by the I&B Code Amendment Act, 2020, on the present Application under Section 7 of the I&B Code. Therefore, it is not required to be considered whether in the light of the aforesaid Amendment whether the Respondent No. 1 has modified the Application under Section 7 of the I& B Code, or not. Whether MOU dated 06.04.2016 is an agreement for sale the apartments or an agreement for buyback the apartments? - HELD THAT:- It is apparent that MOU is an irrevocable contract and the Respondent No. 1 is duty bound for execution of buy back. There is a provision in the event of failure of the Respondent No. 2 to complete the buy back by the end of 12 month. On completion of all buy back of apartments by the Respondent No. 2, the Respondent No. 1 have no right, claim & interest in the apartments. As per clause 8 of the MOU, the Respondent No. 2 ensures the Respondent No. 1 that in the event of dishonor of any cheques (one cheque of ₹ 65 lacs and another cheque of ₹ 35 lacs), the Respondent No. 1 shall take possession of the apartments on the basis of MOU and no possession letter or any further act or deed would be required. The Respondent No. 1 shall be free to sell/deal with the same in any manner and no demand shall be payable by the Respondent No. 1. Thus, we hold that the MOU is an agreement to buyback the apartments. Whether the Respondent No. 1 is a genuine allottee or a speculative investor? - HELD THAT:- The allottee has made attempt to get back the amount of ₹ 1,00,00,000/- by way of this coercive measure i.e. under Section 138 of the Negotiable & Instrument Act - the Respondent No. 1 is a speculative investor and not a person who is genuinely interested in purchasing the apartments. Therefore, she cannot be termed as a allottee as per the explanation attached to clause (f) of Section 5(8) of the I&B Code - The Respondent No. 1 is not a genuine allottee, therefore, the amount of ₹ 35 lacs paid to the Respondent No. 2 is not a Financial Debt and the Respondent No. 1 is not a Financial Creditor. The Application preferred by the Respondent No. 1 under Section 7 of the I&B Code, is dismissed. The Respondent No. 2 is released from rigours of the moratorium and is allowed to function through its Board of Directors from immediate effect - Appeal allowed.
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