Supreme Court Awards Rs. 6 Lakh to Man Acquitted After 6 Years, Faults UP Police Probe  ||  Supreme Court: High Courts Can Restore Power on 50% Deposit in Arbitrary Theft Assessments  ||  Supreme Court: Cooperative Society Cannot Deny RTI Records as Personal if Registrar Can Access Them  ||  SC: CoC Cannot Withdraw Approved Resolution Plan Over Improved Corporate Debtor Finances  ||  Delhi High Court: 24-Week Limit Alone Cannot Restrict Medical Termination of Pregnancy  ||  Allahabad High Court Rejects Challenge to 18% GST on Online Legal Database Services  ||  Madras High Court: FIR Registration Does Not Decide Guilt; Prior Hearing of Accused Not Required  ||  Kerala High Court Orders Speedy Prosecution Sanction Process in Sabarimala Gold Theft Case  ||  Allahabad HC: Missing RT-PCR Report Cannot Bar COVID-19 Compensation if Records Confirm Infection  ||  MP High Court Directs Indore Police to Deploy Volunteers for Reporting Noise Pollution Violations    

VRG Healthcare Pvt. Ltd. Vs. VRG Infrastructure Pvt Ltd - (NATIONAL COMPANY LAW APPELLATE TRIBUNAL) (22 Mar 2023)

In order to qualify the debt to be a 'financial debt', it is necessary that the amount advanced to the Corporate Debtor is against the time value of money

MANU/NL/0209/2023

Insolvency

The instant Appeal under Section 61 of the Insolvency and Bankruptcy Code, 2016 (IBC) has been preferred by the Appellant being aggrieved and dissatisfied by the order passed by the Adjudicating Authority (National Company Law Tribunal, Mumbai Bench) in Company Petition whereby petition under Section 7 of the IBC filed by Appellant with a prayer to initiate the Corporate Insolvency Resolution Process against Respondent herein - "VRG Infrastructure Private Limited (Corporate Debtor)" was dismissed holding that. the claim of the Petitioner is not a Financial Debt within the meaning of Section 5(8) of IBC.

The Impugned Order has clearly stated that there has been no disbursement, in the first instance, and consequently, consideration for time value of money is absent, the Appellant cannot seek to challenge the second observation without satisfying the preliminary challenge to his claim.

The Appellant has not produced any agreement between the Appellant and the Respondent that any interest would be payable by the Respondent/Corporate Debtor against the alleged loan. Further, the Adjudicating Authority rightly come to the conclusion that in order to qualify the debt to be a 'financial debt', it is necessary that the amount advanced to the Corporate Debtor is against the time value of money, which is totally absent in the present matter. Further, it was held that since the Appellant is not a financial creditor as the Appellant has not disbursed money against the consideration for the time value.

Accordingly, the claim of the Appellant is not a 'financial debt' within the meaning of Section 5(8) of the IBC. There is no merit in the Appeal to interfere with the order impugned passed by the Adjudicating Authority. The impugned order passed by the Adjudicating Authority is affirmed. Appeal dismissed.

Tags : RESOLUTION PROCESS   INITIATION   FINANCIAL DEBT  

Share :        

Disclaimer | Copyright 2026 - All Rights Reserved