# In the matter of Kushan Mitra vs. Amit Goel & Ors.

> NCLAT judgment dated 2021-12-16. Citation: TCN-2021-NCLAT-00013. The appeal was filed by Mr. Kushan Mitra, a suspended shareholder of CMYK Printech Limited…

- **Court:** NCLAT
- **Order date:** 16 Dec 2021
- **Citation:** TCN-2021-NCLAT-00013
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/kushan-mitra-vs-amit-goel-ors-a721b3e4

## Summary

### Background

The appeal was filed by Mr. Kushan Mitra, a suspended shareholder of CMYK Printech Limited (Corporate Debtor), against the order dated 19th January, 2021, passed by the National Company Law Tribunal (NCLT), New Delhi, Bench – III. The NCLT admitted an application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) by Mr. Amit Goel, the first respondent, against the Corporate Debtor. The appeal challenges the admission of the Section 7 petition, arguing that the amount claimed by Mr. Goel does not qualify as a 'Financial Debt' under the IBC.

## Facts

Mr. Amit Goel, the first respondent, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) against CMYK Printech Limited (Corporate Debtor). The Adjudicating Authority admitted the application. Mr. Kushan Mitra, a suspended shareholder of the Corporate Debtor, filed an appeal against the order. The Corporate Debtor had allotted 26,00,566 shares to Mr. Amit Goel, its Director/Financial Creditor, in lieu of an outstanding loan of Rs. 79.68 lakhs. The allotment was made through preferential allotment. The Board of Directors later passed a resolution declaring the allotment invalid and void ab initio. Mr. Kushan Mitra filed a complaint with the RoC regarding the allotment. The first Respondent did not challenge the Resolution Dated

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## Issues and analysis

### Issue 1: Whether ‘Share Application Money' in the event of non-allotment of shares, be treated as …

**Ratio:** The key feature of a Financial Transaction as contemplated under Section 5(8) is

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**Reasoning:** The court reasoned that although the amount was initially paid towards Shares, since the

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**Interpretation:** Section 5(8) of the Code defines 'Financial Debt' as a debt along with

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**Application:** In the present case, the allotment of equity shares was revoked. The court held

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## Parties

- **Judges:** Anant Bijay…; Shreesha…
- **Appellants:** Kushan…
- **Respondents:** CMYK Printech…; Amit…

## Timeline

- **2021-01-19 — Order by…**: Order dated 19th January, 2021 passed by the National Company Law Tribunal, New Delhi,…
- **2018-09-08 — Private Pla…**: The first Respondent made a Private Placement dated 08.09.2018 for the allotment of…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 61 — Appeals and Appellate Authority](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-61)

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