TMI Blog2017 (12) TMI 1798X X X X Extracts X X X X X X X X Extracts X X X X ..... t - The contention that this petition is not maintainable because the respondent name was removed from the Company Master Data is therefore, found not at all sustainable. Exhibit-B is a promissory note or not - debt claimed by the petitioner is a financial debt comes under the purview of section 5(8) of I B Code or not? - HELD THAT:- Exhibit-B comes under the purview of financial debt. Exhibit-B relied upon by the petitioner does not stipulate liability on the respondent to pay interest as claimed. So, also there are no terms stipulated in it that he is liable to repay after enjoying the amount for four months with interest. (enjoying is shown in bold letter to indicate the word used by the petitioner in Ext.B) - Exhibit-B is neither a promissory note, nor a receipt as alleged in Form I and that Exhibit-d has not acquired the status of a financial debt. So also, it does not have consideration for the time value of money. Thus, nor a receipt as alleged in Form 1 and that Exhibit-B has not acquired the status of a financial debt. So also, it does not have consideration for the time value of money. Thus, the debt claimed by the petitioner in the instant case is not a financial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... editor) filed this application under section 7 of the IBC, 2016 read with Rule 4 of the of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rule, 2016 for corporate insolvency resolution process against the respondent M/s. TANSWAY MARKETING PRIVATE LIM TED (Corporate Debtor). Brief facts as construed from the perusal of the records are the following:- 2. The corporate debtor/respondent had availed a cash loan of ₹ 5,00,000/- (Five Lakh Only) from the (Financial Creditor) Smt. Srikanta Sarda/petitioner. The petitioner, Smt. Srikanta Sarda alleged that she had sanctioned a cash loan of five lakh to the respondent as per a letter dated 17.08.2016 issued by the respondent duly signed by its director Mr Mukesh Kumar Singal. The above-said letter allegedly is a promissory note. A copy of the said promissory note is produced, marked and annexed as ' Exhibit-B . 3. The petitioner further alleged that vide Exhibit-B the respondent promised to repay the above-said amount after enjoying it for four months. According to the petitioner since the respondent defaulted repayment of the amount as promised it is liable to pay the amount with interest @15% p.a and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in establishing the existence of default as per Sec. 7 (4) (2) of I B, Code as alleged? 4). Reliefs and cost? Point No.l 9. Ld. Counsel for the respondent highlighting Exhibit-R submitted that the respondent company is not in existence on the date of filing of the petition, Exhibit-R shows that it was downloaded from the website of Ministry of Company Affairs (in short MCA) on 10th November,2017. The date of removal of the name of the company is not found a place in the above said Exhibit-R. This petition was filed on 1st August,2017. 10. Ld. Counsel for the petitioner at this juncture, brought to our notice Exhibit - A filed along with the petition. Exhibit-A is a similar copy of Company Master Data downloaded on 16th June,2017. A reference of Exhibit-A shows that as on 16/6/2017 the company of the respondent was active. However, on a reference of Exhibit-R, dated 10/11/2017 the respondent company status is shown as Strike off. When exactly the respondent company's name was removed from the Company Master Data maintained by the MCA, is not certain. Even on a comparison of exhibit-R and A we cannot assume the exact date of removal of the respondent's name ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Chaturthi by putting his signature or written his name as a witness or not. 15. According to the petitioner it is a promissory note. Regarding the characteristic Of the said document. there is inconsistency. in the Form NO. l, Part IV, the petitioner stated that ₹ 5 lakh was sanctioned to the respondent as a cash loan as per the terms and conditions in the letter dated 17/8/2016. The above said letter is the very same Exhibit-B which is referred to as promissory note in Part V of Form No. I of this petition. So, a question arose as to whether Exhibit-B is a promissory note as alleged by the petitioner. A promissory note is defined under Sec.2 (22) Of The Indian Stamp Act, 1899. It reads as follows: Ptomissory note means a promissory note as defined by the Negotiable Instruments Act, 2882 (26 of 1881): It also includes a note promising the payment of any such of money out of any particular fund which may or may not be available, or upon any condition or contingency which may or may not be performed or happen. 16. As per Rule 5 of West Bengal Stamp Rules, 1994, a promissory note or a bill of exchange shall, except as provided by section Il of The Indian Stamp A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dent has pleaded an alternative case for relief based on original debt, but we transfer the case from the file of the learned single Judge of this Court to the file of the Sub Judge (Chief Judicial Magistrate) Jammu for its trial. To this extent the appeal is allowed, but in the circumstances of the case mthout any order as to costs 21. In the above-said citation Hon'ble single Judge held that suit promissory note being insufficiently stamped was inadmissible in evidence, but Plaintiff/Respondent was entitled to get relief and entitled to sue on original debt and adduce other evidence in support thereof. When the above-said order was challenged before the Hon'ble division bench, the Hon'ble bench has confirmed the above-said judgment of single bench. Bear in mind the above-said proposition no doubt the relief based on unstamped promissory note also cannot be entertained by this Tribunal. 22. The next contention of the petitioner is that she is a financial creditor and the debt claimed by her is a financial debt. The financial creditor is defined under Sec. 7 of the I B Code. A financial creditor means, any person to whom a financial debt is owed and incl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pay the money borrowed with interest. As we stated earlier, Exhibit-B does not stipulate any terms regarding the repayment of the amount allegedly received by the respondent. It clearly shows that the respondent received a sum of ₹ 5 lakh on 17/8/2016. It does not stipulate any liability on the respondent to repay it after a period of four months with interest @15% as alleged by the petitioner. To acquire the status of a financial debt as defined under Sec.5 (8) above referred, a transaction should have consideration for time value of money, which is a substantive ingredient for fulfilling requirement of the expression financial debt. AS per Sec .5 (8)(a) money borrowed would be against the payment of interest; No documents produced and relied upon by the petitioner proves the contention of the petitioner that respondent is liable to pay back the money it received with interest as claimed by the petitioner. 26. What is the nature of the transaction is known to both the lender and the borrower. Whether it is a loan or gift is also not certain. Whether it is a bonafide commercial transaction is also not certain. Truly a loan come with promissory notes. Usually a loan given o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... seems to have not 30. Bearing in mind the above-referred proposition let us see Exhibit-B comes under the purview of financial debt. Exhibit-B relied upon by the petitioner does not stipuate liability on the respondent to pay interest as claimed. So, also there are no terms stipulated in it that he is liable to repay after enjoying the amount for four months with interest. (enjoying is shown in bold letter to indicate the word used by the petitioner in Ext.B). n view of the above said discussion, it appears to us that Exhibit-B is neither a promissory note, nor a receipt as alleged in Form I and that Exhibit-d has not acquired the status of a financial debt. So also, it does not have consideration for the time value of money. Accordingly, we hold note, nor a receipt as alleged in Form 1 and that Exhibit-B has not acquired the status of a financial debt. So also, it does not have consideration for the time value of money. Accordingly, we hold that the debt clairned by the petitioner in the instant case is not a financial debt and, therefore, the claim of the petitioner that the debt claimed by her is a financial debt is also found devoid of any merit. This point is answered acco ..... X X X X Extracts X X X X X X X X Extracts X X X X
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