# In the matter of Global Indian School Education Services Pvt. Ltd. vs. Abhay Narayan Manudhane

> NCLAT judgment dated 2025-02-13. Citation: TCN-2025-NCLAT-00219. Global Indian School Education Services Pvt. Ltd. (Appellant) filed an appeal against an…

- **Court:** NCLAT
- **Order date:** 13 Feb 2025
- **Citation:** TCN-2025-NCLAT-00219
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/global-indian-school-education-services-pvt-ltd-vs-abhay-narayan-manudhane-9d59ad32

## Summary

### Background

Global Indian School Education Services Pvt. Ltd. (Appellant) filed an appeal against an order passed by the National Company Law Tribunal (NCLT), Mumbai Bench, regarding Interlocutory Application No. 2376 of 2020. The dispute arises from a Memorandum of Understanding (MoU) between the Appellant and Housing Development and Infrastructure Ltd. (Corporate Debtor) concerning the construction of a school on land owned by the Corporate Debtor. The Appellant paid a sum of Rs. 2,37,61,440 to the Corporate Debtor as a security deposit, intended as six months' rent for Phase I premises. However, the Corporate Debtor failed to fulfill the conditions precedent outlined in the MoU, leading to delays and concerns from the Appellant. The Corporate Debtor subsequently underwent

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## Facts

Global Indian School Education Services Pvt. Ltd. (Appellant) and Housing Development and Infrastructure Ltd. (Corporate Debtor) entered into a Memorandum of Understanding (MoU) on 19.12.2015. The MoU concerned land identified as CTS No. 551/27, 552 (PT), 552/1, 552/5 to 552/12 in Village Nahur, Taluka Kurla, Mumbai, measuring approximately 7632.10 square meters. The Corporate Debtor was to construct a 'built to suit' building on the land for the Appellant to establish and operate a school. As per clause 8.1(i) of the MoU, the Appellant paid Rs. 2,37,61,440 to the Corporate Debtor, intended as six months' rent for Phase I premises. The Corporate Debtor was required to fulfill certain Conditions Precedent before the land could be demised to the Appellant. Clause 3.3 of

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## Issues and analysis

### Issue 1: Whether the security deposit of Rs. 2,37,61,440 paid by the Appellant to the Corporate Debtor under …

**Ratio:** To qualify as a financial debt under Section 5(8) of the IBC, a transaction must involve

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**Reasoning:** The NCLAT reasoned that the money disbursed by the Appellant was a security deposit for

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**Interpretation:** Section 5(8) of the IBC defines 'financial debt' as a debt disbursed against

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**Application:** In this case, the NCLAT found that the security deposit was not disbursed in

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## Parties

- **Judges:** Rakesh Kuma…; Naresh Sa…; +1 more
- **Appellants:** Global Indian…
- **Respondents:** Housing Developmen…; Abhay Narayan…

## Timeline

- **2015-12-19 — MoU Exec…**: Memorandum of Understanding (MoU) executed between Global Indian School Education…
- **2016-06-01 — Deadline for Conditions…**: Deadline for the Corporate Debtor to fulfill Conditions Precedent as stipulated in the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 5(8) — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-5)

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