JUDGMENT :

SUDHANSU JYOTI MUKHOPADHAYA

This appeal has been preferred by appellants against order dated 23rd January 2017 passed by 'Adjudicating Authority (National Company Law Tribunal), Principal bench, New Delhi whereby and whereunder the 'Adjudicating Authority' held that appellants are not 'Financial Creditor' as defined under section 5(7) of the Insolvency & Bankruptcy Code, 2016 (hereinafter referred to as 'I & B Code). The adjudicatory authority further held that as many winding up petitions are pending before the Hon'ble Delhi High Court against the 'Corporate Debtor' and Financial Liquidator has been appointed, the application preferred by appellants for triggering insolvency process by invoking Section 7 of the 'I & B Code read with Rule-4 and Rule-9(1) of the Insolvency and Bankruptcy (Application to Adjudicating Authority), Rules 2016 (hereinafter referred to as 'Adjudicating Authority' Rules 2016) is not maintainable.

2. The case of the appellants and the submission as made by learned counsel for the appellants are as follows : -

The appellants reached different agreements/Memorandum of Understanding with respondent M/s AMR Infrastructures Limited (hereinafter referred to as 'Corporate Debtor) for purchase of three units being a residential flat, shop and office space in the projects, Kessel-I Valley, One Mall and One Home which were being developed by and promoted by 'Corporate Debtor'.

3. The one of the unit was purchased by the Appellant(s) under the 'Committed Return Plan' as per which if the Appellant(s) were to pay a substantial portion of the total sale consideration upfront at the time of Execution of the MOU, and the Respondent undertook to pay a particular amount to the buyer/purchaser (The appellant(s) in this case) each month, as Committed Returns/Assured Returns from the date of execution of the MOU till the time the actual physical possession of the unit is handed over to the buyer/purchaser. In the said projects the appellants also had an option to choose the construction/time linked payment plan as per which they were required to pay a certain percentage of the sale consideration amount at various stages of construction of the project.

4. The Respondent started paying the committed returns to the Appellant(s) as per the MOU, but stopped paying the committed returns to the Appellant(s) from April, 2014, for the unit of the Appellants No.3 and 4, and from January, 2014, for the units of the remaining Appellants, unilaterally and without assigning any reason. The Appellants contacted the Respondent on various occasions demanding the release/payment for their monthly committed returns but to no avail.

5. Having no other option, the Appellants had jointly filed an Application U/s 7 of the Insolvency and Bankruptcy Code, 2016, before the Adjudicating Authority on 16.01.2017 which was dismissed vide order dated 23.01.2017, which is why the present Appeal has been filed.

6. It is the case of the Appellants that the concept and plan of payment of Committed Returns/Assured Returns by the builders/real estate developers such as the Respondent, is a method adopted by them to mobilise funds/raise finance from the general public/open market at much lower rates than what is normally made available to them by banking and other financial institutions without having the obligation to offer security or any collateral and without there being any regulatory body to supervise and oversee such a transaction thereby making the Appellants the "Financial Creditors" of the Respondent as defined U/s 5 (8)(f) of the I & B Code.

7. It is for this reason that the Respondent had offered to pay a fixed monthly amount to the Appellants as Committed Returns/Assured Returns if the Appellants were willing to pay a substantial portion of the entire consideration amount upfront to them at the time of booking their units, as the Respondent