TMI Blog2020 (2) TMI 1503X X X X Extracts X X X X X X X X Extracts X X X X ..... ed with the Corporate Debtor but so far initiation of the Section 7 of the IBC is concerned the present application is not maintainable. Application dismissed. - (IB) 1886 (ND)/2019 - - - Dated:- 13-2-2020 - MR. ABNI RANJAN KUMAR SINHA, J. For the Petitioner: Mr. Brijesh Gupta For the Respondent: Mr. Rajeev K. Pandey, Ms. Sunieta Ojjha, Ms. Priyadarshni ORDER Mr. Abni Ranjan Kumar Sinha, J. 1. The present petition has been filed under Section 7 of the Insolvency Bankruptcy Code, 2016, (hereinafter referred to as the Code ), praying for initiation of Corporate Insolvency Resolution Process of the Corporate Debtor on grounds of its inability to liquidate its financial debt. 2. As per averments made in the petition, time to time amount has been deposited to the Corporate Debtor and the Corporate Debtor is indebted to the Petitioner for a sum of INR 18,63,108/- alongwith unpaid accumulated interest of ₹ 3,31,663/- @ 13.5 % per annum on account of having deposited by Financial Creditor. Part amount has been received from the Corporate Debtor, however, balance amount is accruing on a day to day basis until the debt owed to the Petitioner stand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or Learned Junior Counsel appeared and submitted that the Corporate Debtor will file written submissions. Accordingly, the Corporate Debtor has filed the written submission in which it is submitted that the application filed by the Petitioner is not maintainable. The amount which the Petitioner claimed does not come under the definition of Financial Debt. It is further mentioned that it is a matter of fact that some friendly loans exchanged has been duly returned. It is further mentioned that TDS certificate in the absence of other documents cannot prove any debt as held by the Court in various judgement. In this regard, reliance has been placed upon the decision passed by the Hon ble High Court of Delhi in the matter of Utility Powertech Limited Vs. Amit Traders, RFA No. 515/2015 decided on 15th May, 2018. Now in the light of the submissions raised on behalf of the Parties, I shall consider the case in hand. 5. I have gone through the averments made in the application, additional documents filed by the Petitioner as well as the written submission filed on behalf of the Corporate Debtor. I find, by filing supplementary affidavit, the Petitioner has filed some additional document ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount raised under any other transaction, including any forward sale or purchase agreement, having the commercial effect of a borrowing; (g) any derivative transaction entered into in connection with protection against or benefit from fluctuation in any rate or price and for calculating the value of any derivative transaction, only the market value of such transaction shall be taken into account; (h) any counter-indemnity obligation in respect of a guarantee, indemnity, bond, documentary letter of credit or any other instrument issued by a bank or financial institution; (i) the amount of any liability in respect of any of the guarantee or indemnity for any of the items referred to in sub-clauses (a) to (h) of this clause; Section 3(6) claim means- (a) a right to payment, whether or not such right is reduced to judgment, fixed, disputed, undisputed, legal, equitable, secured or unsecured; (b) right to remedy for breach of contract under any law for the time being in force, if such breach gives rise to a right to payment, whether or not such right ts reduced to judgment, fixed, matured, unmatured, disputed, undisputed, secured or unsecured; Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the TDS certificate is issued. It is not a precedent on the proposition that if a TDS certificate is issued, it amounts to admission of liability. In light of this, though the deduction of TDS by itself cannot be sufficient to impose liability, but on a totality of facts it is clear that the defendant is liable. 9. Whereas Learned Counsel for the Petitioner submitted that the TDS shows that Tax is deducted on the interest paid to the Petitioner. In the light of that decision as well as the submissions of the parties when I shall consider the case in hand then I am of the view that in the case in hand, there is no dispute that certain amount has been paid by the Petitioner to the Corporate Debtor through cheques on different dates but the question is that can the amount be treated asa financial debt or not? As I have already referred that the Petitioner in his application, everywhere referred the word deposit not the debt and against that deposit, he was getting the interest from the Corporate Debtor, therefore, I am unable to accept the contention of the Petitioner that he is the Financial Creditor under Section 5(7) and the amount which he has deposited comes under the defin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of this Act or payment of interest on such deposits; and (f) providing security, if any for the due repayment of the amount of deposit or the interest thereon including the creation of such charge on the property or assets of the company: Provided that in case where a company does not secure the deposits or secures such deposits partially, then, the deposits shall be termed as unsecured deposits and shall be so quoted in every circular, form, advertisement or in any document related to invitation or acceptance of deposits. (3) Every deposit accepted by a company under subsection (2) shall be repaid with interest in accordance with the terms and conditions of the agreement referred to in that sub-section. (4) Where a company fails to repay the deposit or part thereof or any interest thereon under subsection (3), the depositor concerned may apply to the Tribunal for an order directing the company to pay the sum due or for any loss or damage incurred by him as a result of such non-payment and for such other orders as the THbunaI may deem fit. (5) The deposit repayment reserve account referred to in clause (c) of sub-section (2) shall not be used by the company for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccept or renew deposit in this Act from the public except in the manner provided in this Chapter and a special provision is made regarding the repayment of the deposited amount which was deposited prior to the enforcement of this Section and as per Section 74 (I) (b), the company is liable to repay the amount within 3 years from such commencement on or before expiry of the period from which the deposit is accepted, whichever is earlier and if the company fails to repay the amount then there is a penal provision U/ S 74(3) of the Companies Act, 2013. Here, in the case as I have already held that the Petitioner everywhere mentioned the word 'deposit', thereafter, the amount which he has deposited with the Corporate Debtor does not come within the purview of the definition of Financial Debt rather the Petitioner, admittedly, deposited the amount with the Corporate Debtor and in lieu of that he was getting interest from the Corporate Debtor, therefore, he can claim the refund under Chapter V of the Companies Act, read with Company (Acceptance of Deposits) Rule, 2014. 11. So far, the initiation of proceeding under Section 7 of the Code is concerned, in my view, is not liabl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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