TMI Blog2022 (5) TMI 314X X X X Extracts X X X X X X X X Extracts X X X X ..... 08/2016 and the Supplementary Retirement Deed dated 13/08/2016 were entered into between the Tridhaatu Group and Prince Care Group , to which the Corporate Debtor Tridhaatu Aranya Developers LLP is not a party. The Corporate Debtor is a Limited Liability Partnership incorporated under the provisions of the Limited Liability Partnership Act, 2008, and is a body incorporate independent of its partners. It is to be seen whether any debt/liability has been taken up by a partner in the name of the LLP. In the Application under Section 7 of the Code filed by the Appellant herein the Corporate Debtor is described as an LLP, and as a part of the Tridhaatu Group . The Corporate Debtor is a distinct legal entity and the aforenoted Deeds do not construe any privity of contract between the Corporate Debtor and the Appellant and further establishes that mere issuance of these 2 cheques does not construe liability having consideration for time value of money . Further, the LLP Retirement Deed refers to a lumpsum amount of Rs.45,08,08,384/- to be paid by the Tridhaatu Group . It is the case of the Respondent that out of this sum, a sum of Rs.6,13,34,457/- is towards misc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed under Section 7 of the Code, by the Appellant herein, against M/s. Tridhaatu Aranya Developers LLP (hereinafter referred to as the Corporate Debtor ), observing as follows: 38. Upon perusal of the documents annexed to the Petition and hearing counsels from both the sides, the Bench is of the considered opinion that there is no privity of contract between Petitioner and Corporate Debtor and the LLP agreement dated 07.os.20L2 and the Supplementary Retirement Deed dated 15.08.2OL6 is not a contract signed by and between the Petitioner and Corporate Debtor herein. The Supplementary Retirement Agreement contemplates certain liability of Tridhaatu wherein Tridhaatu agreed to pay the outstanding sum of Rs, 45,08,08,384/- to the Petitioner and provided certain cheques to be paid by the corporate Debtor herein being the group company. The corporate Debtor also confirmed the liability of payment of Rs. 4,03,28,000/- to the Petitioner herein as on 31.03.2018, however, this does not demonstrate any liability towards payment of financial debt. 39. The Petitioner has failed to demonstrate the basic ingredients of financial debt along with interest, if any, which is disbursed agai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ers LLP. It is argued by the Learned Senior Counsel that the definition of Tridhaatu Group includes the respective sister concerns and all group Companies. The Appellant retired from the Respondent LLP vide Retirement Agreement dated 12/08/2016 and received amounts receivable as share of profits. Learned Counsel contended that the principal outstanding loan amount is confirmed in the Balance Sheets for the Financial Year 2018 19 of the Corporate Debtor ; that cheques were issued by the Corporate Debtor in favour of the Appellant towards repayment of the unsecured loans, which cheques were dishonoured on account of insufficient funds. The Learned Adjudicating Authority has failed to take into consideration the Supplementary Retirement Deed dated 12/08/2016, whereby the factum of the unsecured loans repayable to the Corporate Debtor was recorded. It is submitted that the Appellant disbursed the loan to the tune of Rs.6,43,28,000/- on 12/08/2016, the repayment of which is stated in the Supplementary Retirement Deed dated 13/08/2016 entered into between the Tridhaatu Group and the Prince Care Group . The Agreement also provided for payment of interest by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Partnership Act, 2008, and as per Section 3 of the Act; the LLP is a body corporate independent of its partners and cannot be bound by the partners of the LLP. The dispute arises out of the LLP Retirement Deed dated 12/08/2016 and the Supplementary Deed dated 13/08/2016, to which the Corporate Debtor Tridhaatu Aranya LLP is not a party. Hence there is no privity of contract qua the Appellant under the said deeds. The acknowledgement in the Balance Sheets is only for the sake of accounting purpose and the same cannot be read dehors the facts. Out of the alleged amount of Rs.4,05,08,08,384/- a sum of Rs.40,96,11,329/- has already been paid to the Appellant and there are disputes pertaining to reconciliation which are pending between the parties and highlighted in the correspondence dated 05/08/2019. The payment was to be made to the Appellant by the Tridhaatu Group and not by the Corporate Debtor herein. The amount stipulated under the Supplementary Deed was under various heads and a mere issuance of the cheque cannot be a basis to state whether the liability is that of the Financial Creditor or of the Operational Creditor . It is contended that the amounts we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are as under: Date of Payment Mode of Payment by Cheque of BOI Sion Branch Name of Retiring Partner Amount Paid to Retiring Partner 12th August, 2016 031378 Four Seasons Developers Pvt. Ltd. 99,00,000/- 12th August, 2016 031379 PriceCare Developers LLP 7,01,00,000/- Total 8,00,00,000/- (Emphasis Supplied) 6. It is the case of the Respondent/ Corporate Debtor that qua the LLP, the entire amount has been finally settled and the aforenoted clause proves that an amount of Rs. 8 Crs./- was paid towards full and final settlement. 7. The Supplementary Retirement Deed was executed between the Tridhaatu Group and Prince Care Group on 13/08/2016, the relevant provisions of which reads as follows: 8. The material on record evidences that the Supplementary Deed was executed between the Tridhaatu Group and the Prince Care Group and signed accordingly by their representatives. 9. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Corporate Debtor recording the factum of unsecured loans and finally the cheques issued by the Corporate Debtor in favour of the Appellant towards payment of the due amount. At the outset, we address ourselves to the issue raised by the Appellant that the Supplementary Retirement Deed evidences a privity of contract between the Appellant and the Corporate Debtor . 11. It is evident from the material on record that both the Retirement Deed dated 12/08/2016 and the Supplementary Retirement Deed dated 13/08/2016 were entered into between the Tridhaatu Group and Prince Care Group , to which the Corporate Debtor Tridhaatu Aranya Developers LLP is not a party. The Corporate Debtor is a Limited Liability Partnership incorporated under the provisions of the Limited Liability Partnership Act, 2008, and is a body incorporate independent of its partners. It is to be seen whether any debt/liability has been taken up by a partner in the name of the LLP. In the Application under Section 7 of the Code filed by the Appellant herein the Corporate Debtor is described as an LLP, and as a part of the Tridhaatu Group . The repayment amounts and the terms reflected in Clause 1(A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be seen, keeping in view, the terms of both the Deeds entered into between the parties and the nature of relationship between them. Further, the Retirement Deed establishes that no amount is due and payable qua the Respondent herein. There is no ascertained sum crystallised as due and payable . To reiterate, there is no documentary evidence filed to prove that the two cheques amount to acknowledgement of any Financial Debt , especially in the light of the fact that the Retirement Deed and the Supplementary Retirement Deeds have been entered into between the Tridhaatu Group and Prince Care Group , for which the Respondent/ Corporate Debtor is not a party. Therefore, we are of the earnest view that the amounts do not possess the essential ingredients of Financial Debt as defined under Section 5(8) of the Code. This Tribunal has also observed in a catena of Judgements that IBC is not a recovery proceeding or a Code for settlement of collateral disputes. 13. Hence, we see no reasons to interfere with the well-considered Order of the Adjudicating Authority. This Appeal fails and is accordingly dismissed. No Order as to costs. - - TaxTMI - TMITax - Insolvency & Bank ..... X X X X Extracts X X X X X X X X Extracts X X X X
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