# In the matter of Mr. Rajiv Sharma Vs. Deepak Gupta & anr. Company Appeal (AT) (Insolvency) No. 541 of 2022

> NCLAT judgment dated 2022-09-09. Citation: TCN-2022-NCLAT-00223. This appeal was filed by the Suspended Director of the Corporate Debtor, challenging the…

- **Court:** NCLAT
- **Order date:** 9 Sept 2022
- **Citation:** TCN-2022-NCLAT-00223
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/mr-rajiv-sharma-vs-deepak-gupta-anr-company-appeal-e6f3d20a

## Summary

### Background

This appeal was filed by the Suspended Director of the Corporate Debtor, challenging the order dated 04.05.2022 passed by the National Company Law Tribunal (NCLT), New Delhi Bench-IV, which admitted an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC). The application was filed by Respondent No. 1, Deepak Gupta. The case revolves around a Memorandum of Understanding (MoU) entered into on 25.01.2013 between Respondent No. 1 and the Corporate Debtor, M/s Elixir Buildcon (P) Ltd., for a real estate transaction. As per the MoU, Respondent No. 1 agreed to purchase 30,000 sq. ft. of space at Rs. 2,800 per sq. ft., paying 15% of the basic sale price (Rs. 1,26,00,000) at the time of execution. A key clause stipulated that if the Corporate Debtor

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## Facts

On 25.01.2013, Respondent No.1 (Deepak Gupta) and Respondent No.2 (Corporate Debtor M/s Elixir Buildcon (P) Ltd.) entered into a Memorandum of Understanding (MoU) for a real estate transaction. Respondent No.1, in the business of investments in real estate, offered to purchase 30,000 Sq. Ft at Rs.2,800/- Sq. Ft. The Second Party agreed to pay 15% of the Basic Sale Price, Rs.1,26,00,000/-, at the time of execution of the MoU, which was duly paid. Clause 9 of the MoU stipulated that the agreement would continue for 36 months from the date of signing or until possession of all flats/units, or transfer/assignment of the entire super built-up area, whichever was earlier. Clause 10 stated that if the First Party failed to launch the scheme within 180 days, it would be liable

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## Issues and analysis

### Issue 1: Whether the Application filed by Respondent No.1 on 06.11.2020 on the ground that Corporate Debtor …

**Ratio:** Article 137 of the Limitation Act, 1963 prescribes a limitation period of three years for

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**Reasoning:** The NCLAT reasoned that the right to sue accrued to the Respondent after 180 days from

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**Interpretation:** Section 55 of the Contract Act empowers the promisee to void an agreement when

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**Application:** The NCLAT applied the principles of limitation and contract law to the facts of

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## Parties

- **Judges:** Ashok Bh…; Barun M…
- **Appellants:** Rajiv S…
- **Respondents:** M/s Elixir…; Deepak…
- **Advocates:** Arun Kath…; Abhijeet…; +9 more

## Timeline

- **2013-01-25 — MoU Exec…**: Respondent No.1 and Corporate Debtor entered into a Memorandum of Understanding (MoU) for…
- **2020-03-07 — Notice Exercisi…**: Respondent No.1 issued a notice exercising the option to void the MoU, citing the…

## 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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