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TMI Blog2023 (9) TMI 1291X X X X Extracts X X X X X X X X Extracts X X X X ..... nder Section 61 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as `IBC, 2016') by Mascot Capital and Marketing Private Limited (MCMPL), (hereinafter called `Financial Creditor') against the Order dated 20.01.2023, passed by the Learned Adjudicating Authority (National Company Law Tribunal, Mumbai Bench - IV), in C.P. (IB) No.4426/MB-IV/2019, wherein the Appellant's Application under Section 7 of IBC, 2016 against `Savair Energy Limited' (hereinafter referred to as the `Corporate Debtor') for initiation of Corporate Insolvency Resolution Process (`CIRP'), was dismissed. 2. The Application before the Adjudicating Authority (`AA') was filed by the Financial Creditor on 06.12.2019 under Section 7 of the IBC, 2016, se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... S/SK/UTIBR52017031000 352690/571/SAVIER ENERGY 127440 1,80,00,000.00 11.04.2017 RTGS/SK/UTIBR52017041100 358023/571/SAVIER ENERGY 127468 30,00,000.00 15.04.2017 RTGS/SK/UTIBR52017041500 351013/1364/SAVIER ENERGY 127471 5,00,000.00 19.04.2017 RTGS/SK/UTIBR52017041900 352467/571/SAVIER ENERGY 127472 50,00,000.00 25.04.2017 RTGS/SK/UTIBR52017042500 351845/571/SAVIER ENERGY 127475 55,00,000.00 Total 3,20,00,000.00 4. The relevant portion of the Order of the AA dated 20.01.2023 is reproduced below for reference: "e) We have heard the counsel and perused the pleadings available on record. f) After perusal of the documents on record and arguments advanced by the Financial Creditor, thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ian Accounting Standards or such other accounting standards as may be prescribed; (e) receivables sold or discounted other than any receivables sold on nonrecourse basis; (f) any amount raised under any other transaction, including any forward sale or purchase agreement, having the commercial effect of a borrowing; i) From the perusal of the above definition, it is clear that the transaction of Investment under a Joint Venture arrangement does not qualify as a financial debt under Sec. 5(8) of the Code. Nonetheless, even if it is admitted that this transaction took the character of loan in terms of MOU dated 29th April, 2017 as pleaded by the Financial Creditor, the same does not bind the Corporate Debtor in view of Mr. Saji Antony ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... MoU is scanned below: 8. The AA had considered para 3 of the said MoU, wherein it is stated as under: "3. Mr. Saji Antony, agrees to repay the unsecured loan as mentioned in paragraph hereinabove to Mascot Capital & Marketing Pvt. Ltd., within three months from the date of signing of the present MOU along with Rs.50 Lakhs as lumpsum interest amount." Learned Counsel for the Appellant stated that this paragraph may be understood as being worded on behalf of the Company as Mr. Saji Anthony was the Managing Director of the Company and was duly authorised by the Board of Directors to avail unsecured Loans from MCMPL, the Financial Creditor upto Rs.3.5Crs. in terms of the Board Resolution dated 27.02.2017. The Board Resolution dated 27.02. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0. The Appellant was given opportunity to file Written Submissions on or before Monday, 25.09.2023. However, the Registry has confirmed on 26.09.2023 that no Written Submission was filed by the Appellant in the time given. 11. We have heard the Learned Counsel for the Appellant and have perused the records. There is no dispute regarding disbursal of Rs.3.20Crs. from the account of the Financial Creditor to the account of the Corporate Debtor. There is also no dispute that Application under Section 7 of IBC, 2016 was filed within limitation. The AA has erred in relying on the Joint Venture Agreement dated 04.03.2017, which was terminated by consent by both the parties on 29.04.2017 also noting therein that with this termination of MoU, none ..... X X X X Extracts X X X X X X X X Extracts X X X X
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