# In the matter of JC Realcon Pvt. Ltd. IB-856-ND-2019

> NCLT judgment dated 2019-07-10. Citation: TCN-2019-NCLT-02595. The case involves an application filed by Jagdish Kumar Sharma and Kesh Bala Sharma…

- **Court:** NCLT
- **Order date:** 10 Jul 2019
- **Citation:** TCN-2019-NCLT-02595
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/jc-realcon-pvt-ltd-ib-856-nd-2019-93662531

## Summary

### Background

The case involves an application filed by Jagdish Kumar Sharma and Kesh Bala Sharma ('Applicants') under Section 7 of the Insolvency and Bankruptcy Code, 2016 ('the Code') against RC Realcon Pvt. Ltd. ('Respondent') for initiating Corporate Insolvency Resolution Process ('CIRP'). The Applicants, landowners of 3.44 acres in Gurgaon, had entered into a collaboration agreement with the Respondent for developing a commercial colony. The Respondent was to develop and construct the colony, obtaining necessary approvals at its own cost. The Applicants paid significant sums towards external and infrastructure development charges. The Respondent failed to commence construction, leading to the application for CIRP.

## Facts

Jagdish Kumar Sharma and Kesh Bala Sharma (Applicants) owned 3.44 acres of land in Gurgaon, Haryana. They obtained a license to construct a commercial colony on the land. They entered into a bilateral agreement with the Governor of Haryana to set up the colony. The Applicants paid Rs. 12,08,82,000 towards external development charges (EDC) and infrastructure development charges (IDC). They then entered into a collaboration agreement with RC Realcon Pvt. Ltd. (Respondent) on 2014-09-15, where the Respondent agreed to develop and construct the commercial colony. The Respondent was to obtain necessary approvals at its own cost. The Applicants agreed to vest 60% of the project with the Respondent. The Respondent failed to obtain necessary approvals or commence

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## Issues and analysis

### Issue 1: Whether the claim made by the Applicant can be categorized as financial debt under Section 5(8) of …

**Ratio:** Section 5(8)(f) of the IBC defines 'financial debt' as any amount raised under any other

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**Reasoning:** The Tribunal considered whether the Applicants, as landowners, could be considered

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**Interpretation:** The term 'allottee' under the IBC is interpreted in consonance with the

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**Application:** The Applicants, being landowners who entered into a collaboration agreement

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## Parties

- **Judges:** Ina Mal…; V.K. SUB…
- **Appellants:** Jagdish Kumar…
- **Respondents:** RC Realcon Pvt.…

## Timeline

- **2010-10-25 — License G…**: Applicants obtained license no. 84 of 2010 from the Town and Country Planning Department,…
- **2014-09-15 — Collaboration…**: Applicants entered into a collaboration agreement with the Respondent for the development…

## 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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