Case Note & Summary
The appeal was filed by Space Infra Consulting Pvt. Ltd. against an order dated 13/04/2026, which rejected their application under Section 60(5) of the Insolvency and Bankruptcy Code, 2016. The appellant claimed a total amount of Rs. 1,82,00,000 for construction work done for the corporate debtor, Logix Infratech Pvt. Ltd., and argued that five units were allotted to them to set off this debt. Initially, the Resolution Professional admitted the claim but later cancelled it, stating the admission was provisional. The Resolution Professional contended that the claim was disputed and that the allotment of flats did not constitute a financial debt. The Tribunal referenced a prior case which established that allotments in lieu of monetary dues do not qualify as financial debt. The Tribunal concluded that the appellant's only recourse was to file a Civil Suit against the corporate debtor, as the disputes could not be resolved in summary jurisdiction. The appeal was disposed of, granting the appellant liberty to file a Civil Suit, which would be decided on its merits within a specified timeframe.
Headnote
A) Insolvency Law - Financial Debt - Definition and Applicability - Insolvency and Bankruptcy Code, 2016, Section 5 - The appellant's claim was rejected on the grounds that the allotment of flats in lieu of construction work did not constitute a financial debt. The Tribunal relied on precedent which established that such allotments do not amount to financial debt, thus necessitating a civil suit for resolution of disputes (Paras 3-5).
Issue of Consideration
Whether the claim of the appellant as a homebuyer constituted a financial debt under the Insolvency and Bankruptcy Code, 2016.
Final Decision
The appeal was disposed of, granting the appellant liberty to file a Civil Suit against the corporate debtor, which would be decided on its merits within a time-bound frame.
Law Points
- Insolvency and Bankruptcy Code
- 2016
- financial debt
- summary jurisdiction
- Civil Suit
