# In the matter of Gaurav Manav Vs. Rachel L.Chand & Anr. Company Appeal (AT) (Insolvency) NO. 310-2018

> NCLAT judgment dated 2018-07-17. Citation: TCN-2018-NCLAT-00203. The case involves an appeal against an order dated June 13, 2018, by the NCLT, Principal…

- **Court:** NCLAT
- **Order date:** 17 Jul 2018
- **Citation:** TCN-2018-NCLAT-00203
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/gaurav-manav-vs-rachel-lchand-anr-company-appeal-0c6d7a82

## Summary

### Background

The case involves an appeal against an order dated June 13, 2018, by the NCLT, Principal Bench, New Delhi, which admitted an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, filed by Rachel L. Chand against Bhasin Infotech & Infrastructure Pvt. Ltd. (Corporate Debtor). The appellant, a shareholder of the Corporate Debtor, challenged the order, arguing that Rachel L. Chand is not a 'financial creditor' and that there was no debt or default to justify the application under Section 7. The NCLAT is reviewing whether the NCLT's decision to initiate the corporate insolvency resolution process was justified.

## Facts

Rachel L. Chand applied to purchase a commercial unit in the 'Grand Venesia' shopping mall and paid Rs. 8,54,835/- in advance to Bhasin Infotech & Infrastructure Pvt. Ltd. (Corporate Debtor). The Corporate Debtor allotted a commercial space to Rachel L. Chand. The total cost of the space was Rs. 85,48,340/-. Rachel L. Chand made further payments totaling Rs. 55,56,411/-, including the initial payment. Subsequently, Rachel L. Chand defaulted on balance payments. The Corporate Debtor obtained a completion certificate on April 16, 2015, and offered possession on July 15, 2015, demanding Rs. 36,52,448/-. Rachel L. Chand, via email on July 24, 2015, expressed interest in taking possession but stated inability until December 2015, requesting no interest for delayed

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## Issues and analysis

### Issue 1: Whether the Respondent (Rachel L. Chand) can be considered a 'financial creditor' under Section …

**Ratio:** The essential requirement of a 'financial debt' is that it must be 'disbursed against the

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**Reasoning:** The court reasoned that the advance payment made by the respondent for the allotment of a

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**Interpretation:** The term 'financial creditor' is interpreted strictly to mean a person to whom

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**Application:** In this case, the advance payment made by the respondent was for the purchase

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## Parties

- **Judges:** S.J. Mukhop…; A.I.S. C…
- **Appellants:** Gaurav…
- **Respondents:** Bhasin Infotech…; Rachel L.…

## Timeline

- **2015-04-16 — Completion Certificate…**: Completion certificate…
- **2015-07-15 — Possession…**: The Corporate Debtor offered possession of the unit to the 1st Respondent and raised a…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

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