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2024 (2) TMI 675 - AT - Insolvency and BankruptcyMaintainability of Section 7 Application - threshold limit of 100 allottees for filing of Section 7 Application is not fulfilled in the Application - Financial Creditors have filed false, fabricated and forged documents and affidavits - Section 340 r/w Section 195(1)(b) of CrPC - HELD THAT:- Section 7 Application was filed by 143 Applicants on 11.10.2021. The Appellant was impleaded as Respondent No.3 in Section 7 Application, who opposed the maintainability of the Application on the ground that threshold limit as required under Section 7 of the Code is not fulfilled and the Application is not made by 100 valid allottees. The said objection raised by the Appellant was rejected by the Adjudicating Authority vide its order dated 21.10.2022, against which order Company Appeal (AT) (Insolvency) No.1478 of 2022 was filed by the Appellant, which was decided by this Tribunal on 17.11.2023 [2023 (11) TMI 782 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI]. In the Appeal, one of the issues framed was whether Section 7 Application filed by the allottees fulfils the threshold as prescribed under the IBC. The Hon’ble Supreme Court in the case of Amarsang Nathaji [2016 (11) TMI 1658 - SUPREME COURT] has held that Court has to form an opinion that it is expedient in the interests of justice to initiate an inquiry into the offences of false evidence and offences against public justice and more specifically referred in Section 340(1) CrPC. The Adjudicating Authority has rightly not initiated proceeding under Section 340 of CrPC. In view of the facts of the present case, there are no error in decision of the Adjudicating Authority not to direct any action under Section 340(1) of the CrPC. Penalty under Section 65 of the Code can be imposed when there is fraudulent or malicious initiation of proceedings. In the present case, the Applicants who are allottees in real estate project have filed the Application to protect their rights and it is not disputed that they are allottees of the project, which is developed by the Appellant. There is no ground to hold that initiation of Section 7 proceedings by allottees was fraudulent or malicious. Hence, no error has been committed by the Adjudicating Authority in rejecting the prayer of the Appellant to impose the penalty under Section 65. The present is not a case that the Applications filed by the Appellant are rejected by the Adjudicating Authority on the ground of delay, rather the Adjudicating Authority has entered into the allegations and found the allegations not sufficient to grant any relief. Hence, the judgment of the Hon’ble Supreme Court relied by the Appellant in AJIT KR. BHUYAN AND ORS VERSUS DEBAJIT DAS AND ORS [2018 (10) TMI 2021 - SUPREME COURT], does not help the Appellant in the present case. The Adjudicating Authority did not commit any error in rejecting IAs filed by the Appellant - The Adjudicating Authority has rightly observed that the intention of the Appellant is malifide and objections are only to delay the adjudication of Section 7 Application - there are no error in the impugned order, as no ground is made out to interfere with the order, the appeal is dismissed.
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