Hardeep Singh Sawhney vs Sawhney Builders Private Limited

Santanu Kumar Mohapatra, Member (T)

Mr. Hardeep Singh Sawhney claiming to be the financial creditor has filed this application under Section 7 of the Insolvency and Bankruptcy Code, 2016 (for brevity 'the Code') read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 (for brevity 'the Rules') with a prayer for initiation of Corporate Insolvency Resolution Process in respect of the respondent company, M/s. Sawhney Builders Private Limited, claimed to be the corporate debtor.

The Respondent company M/s. Sawhney Builders Private Limited (CIN U 74899 DL 198 OPTC 011019) against whom initiation of Corporate Insolvency Resolution Process has been prayed for, was incorporated on 05.11.1980 under the provisions of the Companies Act, 1956. The registered office of the respondent corporate debtor is situated at C-21, Friends Colony East, New Delhi-110065. Since the registered office of the respondent corporate debtor is in Delhi, this Tribunal having territorial jurisdiction over the place is the Adjudicating Authority in relation to the prayer for initiation of Corporate Insolvency Resolution Process in respect of respondent corporate debtor under sub-section (1) of Section 60 of the Code.

The case of the applicant is that his mother, believing the assurances given by the respondent corporate debtor had booked one Villa for a total consideration of Rs. 7,10,00,000/- in the Group Housing Scheme by the name of 'Amara Towne' at Village Morta, Ghaziabad, Uttar Pradesh Greater Noida, Uttar Pradesh vide Registration form dated 21/04/2014.

It is submitted that the mother of the applicant made a payment of Rs. 7,00,00,000/- being the 90% of the value of the said Villa which was duly acknowledged by the Corporate Debtor vide receipt dated 21/04/2014.

It is the further case of the applicant that the Corporate Debtor was supposed to hand over the possession of the said flat within three (3) years from the aforesaid date of payment of 90% value of the flat.

It has been submitted that mother of the Financial Creditor expired on 13/06/2014 and the name of the applicant Financial Creditor was recorded in the books of the corporate debtor being the legal heir of Smt. Paramjit Kaur Sawhney.

Applicant enquired from the Corporate Debtor regarding the status of the Villa along with other details and was shocked to receive the letter dated 28.11.2016 wherein the corporate debtor acknowledged the payment of Rs. 7 crores and further stated that no construction has started.

It is claimed at part-IV of the application that the Corporate Debtor is liable to pay an amount of Rs. 7,00,00,000/- as on 21.04.2014 to the petitioner Financial Creditor.

It has been alleged that the corporate debtor has failed to refund even the amount booked for the villa and therefore, the present petition has been filed.

Respondent corporate debtor has filed its reply on 25.01.2019.

The case of the respondent in brief is that all the shareholders and the directors of the respondent company are members of one family known as Sawhney family and are closely related to each other. The petitioner is the son of Mr. Narender Pal Singh Sawhney, who is one of the directors of the company. The other two directors are real brothers to Mr. Narender Pal Singh Sawhney. It is further pointed out that wives of all the three brothers were partners in another commercial venture namely Sawhney Export House. It has been alleged that Mr. Narender Pal Singh Sawhney had siphoned of a large amount from the said partnership firm called Sawhney Export House.

Respondent has further submitted that Mr. Narender Pal Singh Sawhney father of the petitioner was given power of Attorney by all the partners of Sawhney Export House authorising him to run the said partnership firm. It is alleged that the amount given as advance by Sawhney Export House to the respondent company was transferred in the name of wife of Mr. Narender Pal Singh Sawhney, one of the partners without taking consent from other partners. It is further alleged that notice dated 20.01.2019 has been issued against such transfer and for its appropriation in the firms account.

It is also the case of the respondent that the Villa in question shown to have been booked provisionally in the name of Ms. Paramjeet Kaur Sawhney (Since Deceased) in the project called 'Amara Towne' was launched in 2006 when the Respondent Company was granted a license for development of a Housing Scheme at Village - Morta Tehsil and District Ghaziabad. The said license was issued on 25.11.2006. A copy of the Grant of License has been placed on record. The said License was valid only upto 17.11.2008. The Detail Project Report (DPR) was to be approved from the Ghaziabad Development Authority (GDA) within a period of 2 years and accordingly the Detail Project Report was submitted with the Ghaziabad Development Authority vide covering letter dated 15.09.2008. It is pertinent to state that the said DPR was never approved from GDA as such the License Granted vide letter dated 25.11.2006 for 2 years i.e. upto 17.11.2008 was never renewed.

It is further submitted that the present dispute as alleged is in fact a cooked-up story concocted for the wrongful gain by Sh. Narender Pal S. Sawhney through his son Sh. Hardeep Singh Sawhney, the Petitioner herein. It is contended that Ms. Paramjeet Kaur Sawhney (Since Deceased) left behind three legal heirs namely Sh. N.P.S. Sawhney (Husband), Sh. Hardeep Singh Sawhney. (Son/Petitioner) and Ms. Laveena Kharbanda (Daughter) and therefore the present petition solely by the son of the deceased and at the back of other heirs is not maintainable.

It has been further alleged that Ms. Paramjeet Kaur Sawhney (Since Deceased) sold property bearing No. A-14, Nizamuddin West, New Delhi vide Sale Deed dated 17.05.2013 for a sum of Rs. 9,00,05,400/- and in order to avoid capital gain tax, Sh. N.P. Sawhney in April 2014 got the amount of Rs. 7 crore, lying in the credit of Sawhney Builders Pvt Ltd, transferred in name of Ms. Paramjeet Kaur Sawhney (Since Deceased) against the purchased of Villa. The said transfer was made solely for the purpose to avoid the capital gain tax which otherwise was due to be paid to the authority concerned.

That the total amount of Sawhney Export House lying in the account with Sawhney builders Pvt. Ltd. was much more than Rs. 7 crore but the amount of Rs. 7 Crore was transferred against the purchase of Villa since the said amount covered the capital gain tax. The total amount of Villa was of Rs: 7,10,00,000/- and Rs. 7,00,00,000/- was shown to have been transferred for the provisional booking of Villa in the name Ms. Paramieet Kaur Sawhney (Since Deceased) when the project was never ever started as was well within the knowledge of Sh. N.P.S. Sawhney who is one of the Directors of the Respondent Company and husband of Ms. Paramjeet Kaur Sawhney.

It is submitted that that the Villa in question is shown to have been booked provisionally in the year 2014 when there were number of criminal cases filed against the Respondent Company by the plot buyers in the project of the Respondent Company as the cheques issued to them returning their advances, were bounced. Sh. N.P. S. Sawhney being one of the Directors was himself taking bail from the various courts in those criminal matters. No person who is facing criminal charges for the cheques being bounced by his company would advise his own wife to invest in the said company. Therefore, Ms. Paramjeet Kaur Sawhney (Since Deceased) did not invest in Sawhney Builders Pvt. Limited against Villa, but the said amount was shown to have been invested in order to avoid payment of capital gain tax.

It is further submitted that the amount given as advance by Sawhney Export House to the Respondent Company was transferred in the name of Ms. Paramjeet Kaur Sawhney (Since Deceased) by Sh. N.P.S. Sawhney who was authorized by all the partners to run the said firm. However, as the diversion of fund was without taking consent from other partners, a notice dated 20.01.2019 was issued to Sh. N.P.S. Sawhney against the said transfer and a copy thereof was supplied to the Respondent Company. Sh. N.P.S. Sawhney has been requested to cancel such booking and to return the money of the said firm in its accounts.

It is further submitted that the respondent company had only issued the receipt to Ms. Paramjeet Kaur Sawhney (Since Deceased) for booking of Villa, however no villa was allotted in favour Ms. Paramjeet Kaur Sawhney. It is submitted that since the project did not work out as such no allotment letter was ever issued to any of the provisional plot buyers/provisional Villa buyers.

It is contended that the provisional booking of a Villa shown in the name of Ms. Paramjeet Kaur Sawhney (Since Deceased) was not accepted by the Income Tax Authority as such Sh. N.P.S. Sawhney being a Director in the Respondent Company got a letter dated 28.11.2016 issued from the Respondent Company giving the detail of the allotted Villa No. 5, so the same could be shown to have been allotted in order to use the same before the authority concerned in income tax. It is alleged that the said letter dated 28.11.2016 has been filed along with the Petition to misguide the Tribunal.

It is submitted that the amount of Rs. 7,00,00,000/- was in fact lying with Sawhney Builders Pvt. Limited i.e. the Respondent Company, in the account of Sawhney Export House, partnership firm.

We have heard the Learned Counsels for the parties and have perused the case records.

It is seen from the case records that despite opportunity granted, petitioner preferred not to file rejoinder to the exhaustive reply affidavit of the respondent. Several allegations made in the reply, therefore, have remained undisputed.

A perusal of the case records further reveals that despite undertaking given during hearing on 28.11.2018 to file additional documents in support of the application, only an irrelevant copy of the passport of the petitioner was filed that to without supported by any affidavit.

Petitioner lacks bona fide. Neither any allotment letter nor any agreement in respect of the Villa has been placed on record. In this respect respondent has affirmed that the project did not work out and as such no allotment letter was ever issued. Petitioner could not explain as to why no steps were taken either to obtain allotment in respect of the villa or to get the refund of the dues.

Applicant has also concealed the material fact that his father is the director and shareholder of the respondent company. The applicant has not come with clean hands, as the disclosure in the application was not full and true.

Respondent has denied that Ms. Paramjeet Kaur Sawhney (Since Deceased) did not invest in Sawhney -Builders Pvt. Limited against the Villa but the said amount was shown to have been invested in order to avoid payment of capital gain tax. It has been alleged that the money belonged to the family partnership firm, which was illegally utilised by the attorney holder without consent from other partners. There is also allegation of embezzling of the amount of the firm for personal use.

As per the respondent the project was scraped in the year 2011 and was never ever started, which was well within the knowledge of Sh. N.P.S. Sawhney who is one of the Directors of the Respondent Company and husband of Ms. Paramjeet Kaur Sawhney. It is contended on behalf of respondent that having knowledge of the situation, no person would advise his own wife to invest in the said company. Applicant has failed to satisfactorily counter these allegations.

There is also nothing on record to explain as to why the alleged dues were not demanded back and the required follow up actions were not pursued since the year 2014, though the stake involved was very high.

Besides there is nothing on record to show that the applicant is the sole legal heir or will holder of Smt. Paramjit Kaur Sawhney, in order to maintain the present petition as the sole assignee of the financial creditor.

It is thus seen that the question as to whether the respondent owes any amount to the petitioner is a highly disputed one and requires evidence and trial. Adjudicating Authority do not decide a money claim nor the present proceedings can be termed as a recovery suit. Such old and highly disputed matters cannot be decided in the present summary proceedings.

For the reasons stated above the application fails and therefore the same is rejected.

It is made clear that any observations made in this order shall not be construed as an expression of opinion on the merit of the controversy and the right of the applicant before any other forum shall not be prejudiced on account of dismissal of instant application.

Let the copy of the order be served to the parties.