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2023 (3) TMI 20 - AT - Insolvency and BankruptcyRejection of application filed under Section 7 of the Insolvency & Bankruptcy Code, 2016 - rejection primarily on the ground of not meeting the required minimum number of allottees as per amendment in Section 7 of the IBC - rejection also on the ground of contractual dispute - HELD THAT:- On going through the investment agreement, there is no difficulty in coming to the conclusion that appellants had invested money for a specified period and that too for some period they received interest as admitted by the Respondent/Corporate Debtor in para 4(j) of it affidavit in reply. The investment agreement was unambiguous for 24 months and in lieu charge was created to the plots. In such situation there was no reason for the adjudicating authority to treat the appellants as allottees. The Adjudicating Authority has further misunderstood the observation of the Hon’ble Supreme Court in Manish Kumar case [[2021 (1) TMI 802 - SUPREME COURT]]. It is evident that the fact remains that after the amendment in section 7 was introduced appeal was filed before the Supreme Court and Hon’ble Supreme Court by its order dated 13.01.2020 while issuing notice directed to maintain status quo with respect to pending applications. Though the Hon’ble Supreme Court finally upheld the amendment, the Hon’ble Supreme Court further extended time to cure the defects within two months from the date of order of Hon’ble Supreme Court. On examination of the aforesaid direction of the Hon’ble Supreme Court it is clear that the impugned order of the Adjudicating Authority fortfeits the right of the appellant to cure the defect in compliance with the order of Hon’ble Supreme Court. It is not in dispute that before amendment under Section 7 was brought by the Govt of India, the application under section 7 filed by the appellant was pending and during pendency of the said application the amendment travelled upto the Hon’ble Supreme Court. Initially Hon’ble Supreme Court directed to maintain status quo and finally on 19.01.2021 while upholding the amendment provided two months time from the date of the order of Hon’ble Supreme Court for curing the defect. However, the Adjudicating Authority before expiry of two months has passed the impugned order on 23.02.2021. Accordingly there is no reason to allow the impugned order to continue. Contractual dispute - HELD THAT:- In view of specific averment made in the Investment Agreement and non-raising of dispute by the Corporate Debtor on debt, there was no reason to record that there was contractual dispute - on this issue also the finding of the Adjudicating Authority is erroneous. The impugned order is hereby set aside and the matter is remitted back to the Adjudicating Authority to hear the parties afresh and pass appropriate order in accordance with law particularly considering the time extended by the Hon’ble Supreme Court in Manish Kumar case and unequivocal Investment Agreement entered in between appellants and the Corporate Debtor - Appeal allowed.
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