K. Ravichandra Babu, J.

1. This Application is filed under Section 9(5) of the Presidency Towns Insolvency Act, 1909 seeking to set aside the Insolvency Notice No. 57 of 2013. The Creditors, filed the Petition under Section 9(2) of the above said Act for issuing an Insolvency Notice to the Debtor who was arrayed as the Second Respondent therein. The First Respondent therein was the Company.

2. The claim of the Creditors in I.N. No. 57 of 2013 is as follows:

"They invested a sum of Rs. 10,30,00,000/- in Lattice Bridge Infotech Private Limited by way of purchase of equity and compulsorily Convertible Cumulative Participating Preference shares. The Debtor is the Managing Director of the said Company. The investments made by the Creditors herein were systematically siphoned out of the Company by the Debtor, who was in control of the management of the said Company. The Debtor utilised the funds for his personal benefits. Therefore, the Creditors filed a Petition in C.P. No. 32 of 2010 before the Company Law Board, Chennai seeking various reliefs. During the course of the above said Company Petition, a Compromise was arrived at between the parties and the same was recorded by the Company Law Board in its Order dated 23.08.2012. The said Order is a Decree in terms of Company Act, 1956. As per the Decree, the Debtor shall make payment of Rs. 5,92,00,000/- to the Creditors towards investment made by them. The Debtor shall pay a sum of Rs. 20,00,000/- on accepting the said Memo of Compromise and the balance amount of Rs. 5,72,00,000/- shall be paid by him in six quarterly instalments commencing from 23.08.2012. Though the Debtor made initial payment of Rs. 20,00,000/- on 23.08.2012, he, however, failed to make further payments thereafter. The Creditors issued a Notice on 22.12.2012 calling upon the Debtor to make payment in terms of compromise. The Debtor by Letter dated 07.01.2013 accepted his liability and however, sought time to make payment. Since he failed to comply with the terms of Settlement, the entire liability becomes due and the Decree passed by the Company Law Board has become final and consequently, the Application under Section 9(2) of the said Act was filed for issuing an Insolvency Notice."

3. This Court issued Notice to the Debtor under Section 9(2) of the said Act. The Debtor has filed the present Application under Section 9(5) of the above said Act, seeking to set aside the Notice on the following reasons:

"The Joint Memo of Compromise entered between the parties before the Company Law Board only constitutes a contract to buy and sell the shares of the Company and therefore, the relation between the parties is that of "Purchaser and Seller" and not as a "Creditor and Debtor". The Creditors are still the owners of all the shares agreed to be sold to the Debtor. The Debtor never borrowed any money from the Creditors. On the other hand, they only invested the money in the shares of the Company. The Memo of Compromise is nothing but only an Agreement to Sell. Clause 10 of the Agreement entitles the Creditors to continue Company Petition in case of any default in making payment by Debtor. The consideration agreed to be paid to purchase shares cannot be construed as a debt. Therefore, the Insolvent Notice under Section 9(2) is not maintainable. The Order passed by the Company Law Board is not a Decree as defined under Section 2(2) of the Civil Procedure Code. It is deemed to be a Decree only for the purpose of execution alone. There is no debt due and payable to the Creditors by the Debtor."

4. In this Application No. 139 of 2013, the Creditors filed Counter Affidavit, wherein they have reiterated the contentions already raised in the Insolvency Petition. They further contended that the Debtor by executing the Compromise Memo, acknowledged the liability which is ascertained and determined and the same is eviden