NCLT's Section 60(5) jurisdiction is summary and excludes adjudication of pre-CIRP contractual disputes requiring detailed evidence on breach and specific performance; Liquidator's claim rejection upheld absent proof.

ORDER

(Hearing through hybrid mode )

The present application has been filed by A.R. Akbar Sherieef, the Applicant under Section 60(5)(c) of the Insolvency and Bankruptcy Code ('Code'/ 'IBC'), 2016 read with Rule 11 of the NCLT Rules, seeking appropriate directions against Umesh Garg, the Respondent/ Liquidator of Jeppiaar Cements Private Limited, in relation to the rejection of the Applicant’s claim and forfeiture of advance money arising out of an Agreement of Sale dated 13.06.2018, seeking the following reliefs:

“V. RELIEF(S) SOUGHT:

In view of the facts above mentioned, the Applicant most respectfully prays that this Hon’ble Tribunal may graciously be pleased to direct the Respondent to execute and register the Sale Deed conveying the Schedule property to the Applicant on receipt of the Balance Sale Consideration and thus render justice.”

2. SUBMISSIONS OF THE APPLICANT:

2.1. The Applicant submits that the Corporate Insolvency Resolution Process was initiated against M/s. Jeppiaar Cements Private Limited pursuant to an order dated 10.10.2019 passed in CP(IB)685/(CHE)2019, and upon failure of resolution, liquidation was ordered by this Tribunal on 26.08.2022, appointing the Respondent as Liquidator.

2.2. It is submitted that prior to initiation of CIRP, he had entered into an Agreement of Sale dated 13.06.2018 with the Corporate Debtor for purchase of 13.58 acres of land situated at Karuppur Senapathy Village, Ariyalur District, for a total sale consideration of Rs.1,23,57,800/-.

2.3. It is submitted that pursuant to the said Agreement of Sale, the Applicant paid a total sum of Rs.75,00,000/- as advance sale consideration, comprising Rs.50,00,000/- through two cheques and Rs.25,00,000/- in cash, which payment was acknowledged by the Corporate Debtor through written endorsement on the Agreement of Sale duly signed by its Directors.

2.4. It is contended that under the terms of the Agreement of Sale, the Corporate Debtor was obligated to conduct survey and demarcation of the property at its own expense within two months, and only thereafter was the Applicant required to pay the balance sale consideration of Rs.48,57,800/-. Thus, payment of the balance amount was contingent upon completion of survey and demarcation by the Corporate Debtor.

2.5. It is submitted that the Corporate Debtor failed to conduct the agreed survey and demarcation of boundaries, and therefore the Applicant’s obligation to pay the balance sale consideration never arose. The Applicant asserts that he has always been ready and willing to perform his part of the contract.

2.6. It is further submitted that in December 2018, in part performance of the Agreement of Sale and as security, the Corporate Debtor handed over to him 13 original title deeds pertaining to the subject lands, which remain in the Applicant’s custody lawfully under the Agreement of Sale. 2.7. It is submitted that upon commencement of liquidation, the Liquidator issued public announcement dated 08.09.2022 inviting claims. The Applicant submitted his claim in Form C on 16.03.2023 for a sum of Rs.1,17,75,000/-, enclosing the Agreement of Sale and proof of payments, while reserving his right to seek specific performance, as the Liquidator is not empowered to adjudicate such relief.

2.8. The Applicant further contends that by email dated 01.05.2023, the Liquidator disputed the cash payment of Rs.25,00,000/- and called upon the Applicant to submit original documents. Thereafter, by order dated 27.05.2023, the Liquidator rejected the Applicant’s claim, forfeited Rs.50,00,000/- paid by cheque, and directed return of the original title deeds.

2.9. It is submitted that the Liquidator has acted without authority in forfeiting the advance money, particularly when the alleged default arose solely due to non-performance of contractual obligations by the Corporate Debtor. It is su