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2022 (2) TMI 1079 - AT - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - landowner intending to share profits emanating from the agreed venture, by way of an MoU - Financial Creditors or Operational Creditors? - sole Member of the CoC does not fall within the ambit of definition of Financial Creditor or not - HELD THAT:- In the instant case, on mutual Agreement, the ‘Corporate Debtor’ and other parties decided to transfer 25% of the land to the Appellant herein on a price decided jointly. As per Clause 4 of the MoU, the Appellant shall fund the cost of construction to the ‘Corporate Debtor’/developer, till the sample flat is ready. It was correlatively decided that ‘both parties have rights to book flats with mutual consent’. Clause 6 stipulates that ‘whatever income is earned from the sale of flats, the Appellant is entitled to 25% of the Net Profit’. The MoU entered into is an Agreement of reciprocal rights and obligations. Both parties being ‘Joint Development Partners’ who entered into a consortium of sorts for developing the subject land and for any breach of terms of the contract, Section 7 Application filed under the Code would not be maintainable as the amount cannot be construed as ‘Financial Debt’ as there is no sum(s) i.e., owed, assigned or transferred to in compliance of the provisions of Section 5(8) of the Code - Keeping in view the peculiar facts of the attendant case on hand, wherein an Application under Section 12-A, the ‘Corporate Debtor’ has settled the claims of the ‘Operational Creditor’ and the sole Member of the CoC is the Appellant herein, whom we, for all the aforenoted reasons, are of the considered view is not a ‘Financial Creditor’, we do not find any illegality or infirmity in the Impugned Order, whereby the Adjudicating Authority has sought to close the CIRP proceedings against the ‘Corporate Debtor’. This Tribunal also took into consideration the observation by the Adjudicating Authority, that subsequent to the Public Announcement, not a single claimant had come forward to file their claims. This Tribunal is not inclined to interfere with the well-reasoned Order of the Adjudicating Authority and hence the Appeal fails and is dismissed.
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