Bhagwandas Ramchandra Bhattad vs Bhattad Brothers Realty Private ...

Bhagwandas R. Bhattad ....Appellant Vs. Bhattad Brothers Realty Pvt. Ltd. & Anr. ...Respondents For Appellant: Mr. Arjun Nanda, Mr. Sumeer Sodhi, Mr. Bharat Kumar Jain, Mr. Mrunal Surana, Advocates. For Respondents: Mr. Nilesh Kothari, Advocate for R1. Mr. Rohit Sharma, Mr. Soyaib Qureshi, Mr. Sandeep Bajaj, Advocates for R2.

ORDER

(Through Virtual Mode)

01.02.2022: Heard Learned Counsel for the Appellant.

2. This Appeal has been filed against the order dated 15.12.2021 passed

by the Adjudicating Authority (National Company Law Tribunal), Mumbai

Bench, Court-I, admitting Section 7 Application filed by the Respondent. The

Corporate Debtor had taken financial benefit to the totaling of Rs.

1,62,13,611/- with regard to which proceedings under Section 7 was

initiated by the Financial Creditor. There has been a settlement between the

parties regarding earlier Company Petition which was withdrawn on

14.03.2019. The Settlement could not be honored by the Corporate Debtor,

hence, Application CP (IB)-4172/MB/2019 has been filed. The Adjudicating

Authority noticing the fact that counsel appearing for the Corporate Debtor

has accepted the debt as well as default to the tune of Rs.1.35 Cr. has

admitted the Application.

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3. Learned Counsel for the Appellant challenging the order submits that

the Adjudicating Authority committed error in observing that no reply was

filed by the Corporate Debtor to Section 7 Application whereas reply was filed

on 20.01.2021 by e-mail. He further submits that he does not admit the

amount of default as claimed by the Financial Creditor.

4. We have heard Learned Counsel for the Appellant and we have also

perused the reply which is claim to have been filed on 20.01.2021 which has

been brought on record at Page 28 of the paper book.

5. In para 7 of the said Reply, following has been stated by the Corporate

Debtor:-

"7. I say that in furtherance of the said Settlement Agreement the Corporate Debtor paid an amount of Rs.60,00,000/- (Rupees Sixty Lakhs Only) to the Financial Creditor. However, the Corporate Debtor did not anticipate further financial trouble coupled with the severe downfall in the real estate (which was already going through tough times) and as such it had become extremely difficult for the Corporate Debtor to adhere to the said Settlement Agreement. I say that in spite of the Corporate Debtor having genuine and bonafide intention to repay the monies as agreed by it under the said Settlement Agreement on account of such unprecedented financial trouble and downfall in the real estate market led to such circumstances that the Corporate Debtor could not make the balance payment maximum to the extent of Rs. 1.35 Crores to the Financial Creditor in terms of what was agreed under the said Settlement Agreement."

6. The figure of Rs.1.35 Crore which was mentioned in the Reply was

reflected in the oral submission made by the Counsel for the Corporate

Debtor which has been noted by the Adjudicating Authority. There being Comp. App. (AT) (Ins.) No. 95 of 2022 3

financial debt due which was an admitted fact, we see no error in the

impugned judgment of the Adjudicating Authority by which Application has

been admitted. Counsel for the Corporate Debtor submits that he does not

admit the amount of default. An amount of Rs. 1.35 Crore having been

admitted, the Application was rightly admitted. Counsel for the Appellant

further submitted that he is ready to enter into settlement with the

Respondent to pay all the outstanding dues. It is open for the Corporate

Debtor to enter into settlement and on the basis of settlement, if any, may

file an Application under Section 12A before the Competent Authority i.e.

Adjudicating Authority for passing appropriate order. It is made clear that

the observations made in this order are without prejudice to the rights and

contentions of the parties.

The Appeal is dismissed.

[Justice Ashok Bhushan] Chairperson

[Dr. Alok Srivastava] Member (Technical) Anjali/nn

Comp. App. (AT) (Ins.) No. 95 of 2022