# In the matter of Homestead Infrastructure Development Pvt. Ltd. (IB) 1018 (ND)-2018

> NCLT judgment dated 2019-01-14. Citation: TCN-2019-NCLT-05254. The case involves a petition filed under Section 7 of the Insolvency and Bankruptcy Code, 2016,…

- **Court:** NCLT
- **Order date:** 14 Jan 2019
- **Citation:** TCN-2019-NCLT-05254
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/homestead-infrastructure-development-pvt-ltd-ib-1018-nd-2018-e0db6840

## Summary

### Background

The case involves a petition filed under Section 7 of the Insolvency and Bankruptcy Code, 2016, by Sharad Vadehra against M/S Homestead Infrastructure Development Pvt. Ltd., seeking initiation of the Corporate Insolvency Resolution Process (CIRP). The applicant, Sharad Vadehra, claims to be a financial creditor to whom the corporate debtor owes a financial debt. The corporate debtor is alleged to have defaulted on payments related to a residential unit booked by the applicant in a project launched by the corporate debtor's subsidiary. The respondent raised objections, claiming a lack of privity of contract between the financial creditor and the corporate debtor, arguing that the transaction was with the corporate debtor's subsidiary.

## Facts

Sharad Vadehra, the applicant, booked a residential unit in a project launched by M/S Homestead Infrastructure Development Pvt. Ltd. (the corporate debtor) through its subsidiary, M/S Golden Peacock Residence Private Ltd. The applicant made payments totaling Rs. 4,26,53,144/- to the corporate debtor and its subsidiary between 2012 and 2015. The corporate debtor issued demand letters for payments. The applicant also submitted that the time stipulated in the Flat Buyer's Agreement dated 19.02.2013 for completion of the construction activities and handing over of the Unit allotted to the Financial Creditor expired on 18.02.2016. The applicant claimed that the corporate debtor was liable to compensate him for failure to hand over possession. The respondent argued that

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## Issues and analysis

### Issue 1: Whether there was a default in repayment of financial debt by the Corporate Debtor, M/S Homestead …

**Ratio:** Section 2(11) of the Insolvency and Bankruptcy Code, 2016 defines 'debt' as a liability

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**Reasoning:** The court considered the statement of account reflecting the outstanding debt due as Rs.

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**Interpretation:** The definition of 'debt' under Section 2(11) is interpreted broadly to include

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**Application:** Based on the outstanding debt and the definition of debt under the IBC, the

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## Parties

- **Judges:** Ina Mal…; Deepa Kr…; +1 more
- **Appellants:** Sharad Va…
- **Respondents:** M/s. Homestead…

## Timeline

- **2011-11-22 — Incorporation of…**: M/s Homestead Infrastructure…
- **2012-01-27 — Incorporation of…**: M/s. Golden Peacock Residence…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 2(11) — Application](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-2)

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