TMI Blog2024 (3) TMI 24X X X X Extracts X X X X X X X X Extracts X X X X ..... shall file an application for withdrawal of Section 9 Application, for which no exception can be taken and the Adjudicating Authority rightly allowed the application for withdrawal. However, the MoU cannot be read to mean that the Operational Creditor has relinquished its right to make any further application before the Adjudicating Authority in event any default is committed by the Corporate Debtor. There was no occasion for declining any further liberty to the Operational Creditor to reapproach to the Adjudicating Authority at the stage when Section 9 Application was withdrawn on the basis of Section 12A Application. In the MoU, between the parties, neither there was any specific prayer made for revival of the CIRP, nor there was any statement that Operational Creditor has relinquished its right to revive the CIRP. The learned Counsel for the Respondent has relied on judgment of this Tribunal in Amrit Kumar Agrawal vs. Tempo Appliances Pvt. Ltd. [ 2020 (11) TMI 993 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI ]. In the said case, Section 7 Application was dismissed on the ground of default in payment of Settlement Agreement holding that the debt does not come under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r dated 21.08.2023 to the extent it does not grant liberty to the Appellant to approach the Hon ble Adjudicating Authority in the event of breach of the Memorandum of Understanding dated 07.07.2023. c) Pass any other appropriate orders as the Hon ble Appellate Tribunal deems fit. 2. Brief facts of the case are that Section 9 Application was filed by the Operational Creditor, claiming default of operational debt amounting to Rs.1,85,00,668/- plus interest @ 12.75% from 07.11.2021 till the repayment of the entire debt. In Section 9 Application, a MoU was entered between the parties dated 07.07.2023, on the basis of which the impugned order was passed, allowing the withdrawal of Section 9 Application under Section 12A. In the impugned order, the Adjudicating Authority, while permitting withdrawal, also directed we are not inclined to grant any further liberty to the Applicant to re-approach this Adjudicating Authority for the cause of action against the same Corporate Debtor for the purpose of recovery of its operational dues . Aggrieved against refusal to grant liberty, this Appeal has been filed. 3. Learned Counsel for the Appellant challenging the order contends tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was undertaken by the Operational Creditor. In the MoU dated 07.07.2023, which is filed at Annexure A-3, after noticing few facts, the parties under the MoU entered into following terms and conditions: NOW THE MOU WITNESSETH AS UNDER: 1. That the Second Party has agreed to pay a total amount of Rs.1,85,00,000/- (Rupees One Crores Eighty Five Lakhs only) to the First Party towards full and final settlement of all its claims towards it. Against the claimed amount following payments have been made by the Second Party: a) Rs.25,00,000/- (Rs.Twenty-Five Lakhs Only) on 30.06.2023 through RTGS vide ICICIR52023063000563570 by Mrs. Smriti Khandelwal wife of Mr. Ankit Khandelwal and b) Rs.25,00,000/- (Rs. Twenty-Five Lakhs Only) on 30.06.2023 through RTGS vide ICICIR520236300056285 by Mrs. Smriti Khandelwal wife of Mr. Ankit Khandelwal. c) For the payment of remaining settlement amount of Rs.1,35,00,000/- (Rupees One Crores Thirty- Five Lakhs Only) it was agreed between both the parties that either:- ➢ Second party shall transfer their all rights in the property namely Plot No. F-56, Agrofood Park, MIA, Alwar Tehsil, Rajasthan by execution of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt between the parties an application shall be filed for withdrawal/ closure of CIRP. The said settlement made in paragraph-2 of the terms and conditions as noted above did not deal with any future contingencies, which would arise in future, nor Operational Creditor relinquished any of its right arising out of its subsequent event. We, thus, are of the view that very basis of denial to grant further liberty to the Appellant to reapproach the Adjudicating Authority was fallacious, as the MoU only states that in view of the agreement between the parties, both the parties shall file an application for withdrawal of Section 9 Application, for which no exception can be taken and the Adjudicating Authority rightly allowed the application for withdrawal. However, the MoU cannot be read to mean that the Operational Creditor has relinquished its right to make any further application before the Adjudicating Authority in event any default is committed by the Corporate Debtor. The MoU to the contrary contained a condition that MoU is confidential and binding on the parties and none of them terminate or deviate from any of the terms of the MoU. Clause-5 of the MoU, which we have already extract ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as dismissed on the ground of default in payment of Settlement Agreement holding that the debt does not come under the definition of financial debt. In the above case, MoU was entered on 22.09.2017 between the Appellant and the Principal Borrower, where Respondent stood as Guarantor. Since, cheques issued by Principal Borrower, were dis-honoured on presentation, the Respondent as guarantor came forward to pay the outstanding amount of Rs.86 lakhs with interest and issued two cheques in consideration of such liability. The question was whether as per the terms of Settlement, the obligation to pay the outstanding liability of Rs.86 lakhs together with interest on the part of Respondent constituted a financial debt. The issue for consideration has been noticed in paragraph-3 of the judgment, which is follows: 3. .The issue for consideration is that whether in terms of this agreement the obligation to pay the outstanding liability of Rs. 86 lakh together with interest on the part of Respondent constituted a financial debt within the purview of Section 5(8) of the I B Code and whether the Appellant can be treated as Financial Creditor entitled to trigger Corporate Insolvency ..... X X X X Extracts X X X X X X X X Extracts X X X X
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