Application U/S 7 Of IBC Cannot Be Admitted In Absence Of Debt And Default: NCLAT New Delhi

The NCLAT New Delhi bench of Justice Ashok Bhushan and Mr. Barun Mitra has held that application under section 7 of the IBC cannot be admitted in absence of any debt and consequent default on the part of the corporate debtor. Payments having already been received by Thakkars of the balance amount for payment to the Investors, there was no debt or default on the part of the Developers That application is time barred as cause of action arose to the Investors after 7 months and they having admitted payment of ₹1.3 Crores in their letter by 15.10.2011. In any view of the matter, the amount of ₹170 Crores which were refunded by Corporate Debtor to the Thakkar and his Company were only with respect to payment of amount of refund of ₹3 Crores received from Financial Creditor.” The tribunal also noted the conduct of the parties. The financial creditor did not send even a demand notice for claiming the amount from the date when they came to know that the project will not commence till lodging of a police complaint was lodged by the corporate debtor against the vendors for misappropriating the deposited amount. The tribunal observed that “Corporate Debtor had refunded the amount of ₹1.7 Crore to Thakkars and their Company, which was meant for refund to the Investors towards their amount of ₹3 Crores.Silence of Financial Creditor for long 8 years of not writing even letter to Corporate Debtor or Vendors/Thakkars clearly indicates that refund of ₹3 Crores was satisfied.” However, the tribunal did not find any averment to the effect that there were collusions between the vendors and the financial creditor to cheat the corporate debtor therefore it was observed that the ingredients of section 65 of the code were not satisfied in the present case for which parties were discharged.