9M Corporation vs Naresh Verma

9M Corporation ... Appellant Through its proprietor Having Office at: 108, 1st Floor, Anand Plaza, Udaipur, Rajasthan-313001

Versus

1. Mr. Naresh Verma Respondent No. 1

Resolution Professional Bohra Pratisthan Private Limited Having its Office at:

416/7 & 8, 1st Floor, Opp. Karkardooma Metro Station, Karkardooma, New Delhi-110092.

2. STCI Finance Limited, Respondent No. 2 Through its Authorized Representative, Having office at:

401 & 412, 4th Floor, Prakashdeep Building, 7, Tolstoy Marg, New Delhi-110001.

3. Phosphate India Pvt. Ltd. Respondent No. 3

Through its Authorized Representative, Having office at:

107-108, Anand Plaza, University Road, Udaipur-311001.

Present

For Appellant: Ms. Anju Jain, Mr. Hitesh Sachar, Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 1 of 23 Advocates

For Respondent: Mr. Amol Vyas, Ms. Saumil Sharma, RP, R-1, Mr. Atul Sharma, Mr. Kamal Gupta, Caveators, R-2.

Mr. Dhruv Dewan, Mr. Tabrez Malawat, Mr. Harshita Choubey, Advocates for R-3.

Judgment (Date:13.07.2021)

{Per: Dr. Alok Srivastava, Member (T)}

1. This appeal has been filed by the Appellant assailing the

order dated 11.12.2020 (hereinafter referred to as the Impugned

Order) passed by the Adjudicating Authority (National Company

Law Tribunal, Jaipur Bench) in IA No. 294/JPR /2020 in CP (IB)

No. 171/7/JPR/2019 under Section 60 (5) of the Insolvency and

Bankruptcy Code, 2016 (hereinafter called "IBC") read with Rule 11

of the National Company Law Tribunal Rules, 2016 seeking

direction against Respondent No. 1 (Resolution Professional) to

constitute the Committee of Creditors in accordance with Section

21 of IBC.

2. The brief facts of the case as presented and argued by the

Appellant are that the Appellant 9M Corporation, which is a

proprietorship concern, is a financial creditor of the Corporate Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 2 of 23 Debtor (Bohra Pratisthan Private Limited-hereinafter referred to as

"BPPL"). The Appellant has claimed that the Committee of Creditors

was constituted by the Respondent No.1, i.e. the Resolution

Professional, in pursuance to the order of admission dated

5.8.2019 passed on the Section 7 application filed by the Appellant

against the Corporate Debtor BPPL, and the first meeting of the

Committee of Creditors (hereinafter called the "COC") was held on

4.9 2019. The Appellant has claimed that in the first meeting of the

COC, the Resolution Professional determined the voting percentage

of each member of the COC as follows: -

9M Corporation (Appellant) 6.11%

STCI Finance Limited (Respondent No. 2) 75.90%

Phosphate India Private Limited (Respondent No.3) 17.99%

The Appellant has further stated that the claim filed by STCI

Finance Limited was based on debtor-creditor relationship, which

is the result of guarantee given by the Corporate Debtor BPPL for a

loan of Rupees 24 crores sanctioned by STCI Finance Ltd. to Bohra

Industries Limited (hereinafter referred to as "BIL"), which is a

group concern of the Corporate Debtor BPPL.

3. It is claimed by the Appellant that BPPL has furnished a Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 3 of 23 collateral security to Respondent No. 2 STCI Finance Limited and

thus STCI Finance Ltd. is not a financial creditor as defined in

Section 5(7) and Section 5(8) of the IBC since the fundamental

requirement of a financial debt is "disbursal against the

consideration for the time value of money".

4. Finally, the Appellant has claimed that the Adjudicating

Authority has not considered this important distinction between

„debt‟ and „financial debt‟, and has considered the debt advanced by

STCI Finance Ltd. (Respondent No. 2) to be a financial debt. The

Appellant has, therefore, prayed in the appeal for setting aside the

Impugned Order and directing Respondent No.1 to reconstitute the

COC of the Corporate Debtor in accordance with Section 21 of the

IBC.

5. All the parties in the appeal stated that since this appeal

involves a question of law, they would not be filing any pleadings.

Instead they filed written submissions in support of their respective

contentions. In addition, Learned Counsels of all the parties

presented oral arguments. we have gone through the written

submissions and oral arguments put forth in the case by all the

parties.

Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 4 of 23

6. The Learned Counsel for Appellant has stated that the

Adjudicating Authority has erroneously placed reliance on the

judgment dated 15.10.2020 in the matter of Ascot Realty Private

Limited versus Ajay Kumar Agarwal and Others (Company

Appeal AT (Ins) No. 658 of 2020) claiming that this judgment of

the Hon‟ble NCLAT does not apply to the present case. He has

urged that the judgment of Hon‟ble Supreme Court in Anuj Jain

Interim Resolution Professional for Jaypee Infratech Limited

versus Axis Bank Limited, Civil Appeal Nos. 8512-8527 of 2019

[(2020) 8 Supreme Court Cases 401] applies in the present case.

7. The Ld. Counsel for Appellant has further argued that if the

Corporate Debtor has given its property in mortgage to secure the

debt of a third-party, it would fall within the definition of "debt

under section 3(11) of the IBC but such an amount would remain a

debt only and cannot take the form of "financial debt" within the

meaning of section 5(8) of the IBC. She has pointed out that there

is no disbursal of any amount against the consideration for time

value of money by Respondent No. 2 to the Corporate Debtor, and

therefore such a debt cannot take the form of a financial debt. She

has further argued that the root requirement for a creditor to

become a financial creditor for the purpose of Part II of IBC is that

there should be a financial debt owed to the financial creditor. In Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 5 of 23 the instant case Respondent No. 2 has advanced facility to a third

party, namely Bohra Industries Limited (BIL) and taken a security

towards the loan advanced to BIL from the Corporate Debtor Bohra

Pratisthan Private Limited (BPPL).

8. The Learned Counsel for Appellant has also cited the

judgment of this tribunal in Amrit Kumar Agarwal versus Tempo

Alliances Private Limited, Company Appeal AT (Insolvency) No.

1005 of 2020 to emphasize that mere obligation to pay dues does

not bring liability within the ambit of section 5(8) of the IBC to

make such debt a financial debt. She has urged that in the present

matter there may be remedies available for the secured creditor for

recovery of his loan amount but this remedy is not through

triggering CIRP.

9. The Ld. Counsel for Appellant has claimed that Respondent

No.1, the Resolution Professional, has not constituted the

Committee of Creditors in accordance with the provision of Section

21 of IBC since STCI Finance Ltd. is not a financial creditor

whereas it has been considered as one.

10. The Learned Counsel for Appellant has said that in Anuj

Jain (supra), in Para 54, the issue of guarantee obligation falling Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 6 of 23 within the ambit of financial debt under Section 5(8) of the IBC has

been considered wherein the Hon‟ble Apex Court dealt extensively

with the judgment of SBI vs Kusum Ballabhdas Thakkar (1991

SCC online GUJ 14) and considered the provisions of Sections

126, 127 and 128 of the Contract Act. The Hon‟ble Apex Court

had, after due consideration, refused to stretch the issue of

guarantee obligation with respect to definition of financial debt

under section 5(8) of the IBC, holding that to fall within the

definition of financial creditor the lead element is „disbursement

against the consideration for the time value of money.‟

11. In his arguments and written submission, the Ld. Counsel

for Respondent No. 2 has maintained that the claim submitted by

Respondent No. 2 to the Resolution Professional after the initiation

of CIRP is based on the liability of the Corporate Debtor under a

guarantee given in the Loan Agreement dated 21.12.2017 entered

between the Corporate Debtor in favour of Respondent No.2 (page

469 of Appeal Paperbook, Column No. 6 of Form C). Such a

guarantee is sufficient for conferring the status of financial creditor

to STCI Finance Ltd.In support he has referred to Section 5(8)(i)

read with Section 5(8)(a) of the IBC.

12. The Learned Counsel for Respondent No.2 has clarified that Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 7 of 23 ratio of the judgment in Anuj Jain (supra) is not applicable in the

instant case, because in this judgment the Hon‟ble Apex Court has

examined the issue whether solely on the basis of security interest

like mortgage created by the Corporate Debtor, a creditor will fall

within the definition of financial creditor. He has pointed out that

in the matter of Ascot Realty (supra), the NCLAT upheld the

inclusion of claims based on corporate guarantees. He has further

added that there is no dispute that disbursement has been made

by Respondent No.2 to BIL, the principal borrower, and the

requirement of disbursement has been fully complied with. Applied

to the context of the instant case, the Learned Counsel has urged

that under the Loan Agreement dated 21.12.2017 and the

guarantee given therein, the Corporate Debtor has irrevocably and

unconditionally guaranteed and undertaken to pay to Respondent

No.2, without demur and merely upon demand by Respondent

No.2, all and every sum of money owed by BIL to STCI Finance

Limited in respect of the said loan facility, as between the

guarantor (Corporate Debtor) and STCI Finance Limited (creditor)

and the Corporate Debtor shall be deemed to be the principal

debtor for all the monies in respect of the loan (refer pp. 443 and

446, of the Appeal Paperbook, Annexure IV).

13. The Learned Counsel for Respondent No.1 BPPL (Corporate Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 8 of 23 Debtor), through the Resolution Professional, has argued that the

definition of "financial debt" is an inclusive definition and it

includes those amounts too, for which guarantee or indemnity has

been given for the amount of any liability under section 5 (8)(i) of

the IBC. He has further added that in the instant case, both

conditions of the definition of financial debt are present, i.e. there

is disbursement of debt to BIL and the Corporate Debtor BPPL has

given a corporate guarantee to STCI Finance Limited to the effect

that in case of non-payment of debt by BIL, the amount can be

recovered from the Corporate Debtor.

14. In his arguments, the Learned Counsel for Respondent No.3

has stated that his client has a 17.99% voting right in the

Committee of Creditors. He has emphasized that while he is

supporting the case of the Appellant, his arguments are different

from the arguments put forth by the Learned Counsel of the

Appellant. He has urged that a "financial creditor" is a creditor

who is supposed to be involved with the business of the Corporate

Debtor in the sense that the monies advanced/loaned by him go

into the growth, rejuvenation and the overall functioning of the

corporate debtor.

15. Hence, the Ld. Counsel for Respondent No. 3 has argued, in Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 9 of 23 the instant case, by virtue of the fact that BPPL has provided

guarantee in the loan provided by STCI Finance Ltd. to BIL, STCI

Finance Ltd. assumes the status of Financial Creditor of the

Corporate Debtor BPPL. The Learned Counsel for Respondent No.

3 has also pointed out to para 12 of the Ascot Realty judgment

(Diary No. 25004 dated 27.1.2021) to point out that Anuj Jain

(supra)lays down that there should be disbursal against

consideration for the time value of money which is the root

ingredient for a debt to become a financial debt, and a secure debt

would not qualify to be a financial debt unless there is

disbursement against the consideration of time value of money.

16. We have perused the replies of Respondents and the written

submissions submitted by all the parties and also considered the

oral arguments put forth by learned Counsels of all the parties in

support of their respective cases.

17. The Appellant has maintained that giving the status of

financial creditor to STCI Finance Ltd, is against the judgment of

Hon‟ble Supreme Court in the matter of Anuj Jain (supra) wherein

it has been held that security extended by the Corporate Debtor

towards third-party debt would stand outside the purview of

financial debt and the creditors would not qualify as financial Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 10 of 23 creditors within meaning of Section 5(8) of the IBC. If such a

position is accepted, Respondent No.2 STCI Finance Limited should

be deleted from the list of members of the COC since it is not a

financial creditor of the Corporate Debtor BPPL.

18. It is an admitted position, that there is disbursement of debt

against the consideration for the time value of money by the

creditor STCI Finance Limited to the Borrower BIL and the

Corporate Debtor BPPL vide Letter of Intent dated 15.11.2017 and

the Terms and Conditions for the Sanction of Corporate Term Loan

of Rupees 24 crores (pp 138-149 of Appeal Paperbook). The True

Copy of the Resolution passed by the Executive Committee of BIL

(the Borrower) on 8.12.2017 is attached at pp. 150-152 of the

Appeal Paperbook. The Loan Agreement executed by and between

BIL (The Borrower) and STCI Finance Ltd. (the Lender) is attached

at pp. 154-200 of the Appeal Paperbook) and Loan Summary

Schedule, Schedule I is attached at pp. 233-239. The Security and

Guarantees offered on behalf of the Borrower is at Schedule I on

pp. 235-236of Appeal Paperbook, Vol. II. We reproduce the

sections relating to „Security‟ and „Guarantees‟ from Loan Summary

Schedule (Schedule I) attached at pp. 235-236 on Appeal

Paperbook, Vol. II for appreciation of the properties/assets offered

therein:-

Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 11 of 23 Security a. Residential plot situated in Plot No.3-A and 53-B,

Ambamata Scheme, Ayurvedic College Chouraha

to Mahakaleshwar Road, Udaipur, Rajasthan

Admeasuring 15120 sq.ft. belonging to Mr.

Hemant Bohra & Mrs. Beena Bohra.

b. Office No. 301, Anand Plaza, Block (A), Third Floor,

University Road, Udaipur, Rajasthan admeasuring

564.25 sq.ft. belonging to M/s. Bohra Pratisthan

Pvt. Ltd.

c. Office No. 314-315, Anand Plaza, Block (A), Third

Floor, University Road, Udaipur, Rajasthan

admeasuring 456.82sq.ft. belonging to M/s. Bohra

Pratisthan Pvt. Ltd.

d. Office No. 336, Anand Plaza, Block (B), Third Floor,

University Road, Udaipur, Rajasthan admeasuring

4054.77sq.ft. belonging to M/s. Bohra Pratisthan

Pvt. Ltd.

e. Industrial property situate in Plot No. 4897 to 4903

Jhamar Kotra Road, Tahsil Girwa, Village Umarda

admeasuring 11300 sq. mtr. belonging to M/s.

Bohra Pratisthan Pvt. Ltd.

f. Industrial property situated in Plot No. 311, 312,

313, 314, Dhol Ki Pati Village, Udaipur-Banswara

Road, Tahsil Girwa, Udaipur district admeasuring

5773 sq.mtr. belonging to M/s. Bohra Pratisthan

Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 12 of 23 Pvt. Ltd."

Additional Security: Pledge of 4,00,000 Equity Shares of

M/s BIL Ltd. by Mr. Hemant Kumar Bohra (pledger)

Guarant 1. Irrevocable and unconditional Personal Guarantee

ees of Mr. Hemant Kumar Bohra.

2. Irrevocable and unconditional Personal Guarantee

of Mrs. Beena Bohra to the extent of the value pf

the property owned by Mrs. Beena Bohra which is

offered as security to STCI.

3. 3. Corporate Guarantee of M/s Bohra Pratisthan

Pvt. Ltd.

19. A Deed of Guarantee was executed by BPPL (the Guarantor)

and BIL (the borrower) on 21.12.2017 (attached at pp. 441-452,

Appeal Paperbook, Vol.III) wherein Clause „B‟ and para 2 an

unconditional and irrevocable corporate guarantee of the

Guarantor is included explicitly. This corporate guarantee is in

relation to the loan provided by STCI Finance Ltd. to BIL which is

stated in Clause „A‟ of the Deed of Guarantee.

20. The Loan Agreement entered into between the STCI Finance

Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 13 of 23 Ltd. and Bohra Industries Ltd. on 21.12.2017 and the Schedule I

therein (Schedule I, attached at pp. 233-240 of the Appeal

Paperbook, Vol. II) and the Deed of Guarantee (pp 441-452 Appeal

Paperbook, Vol.III) have been filed by the Appellant as part of

Appeal Memo and none of the parties have disputed these

documents. It is clear from the reading of Schedule I of the Loan

Agreement that Bohra Pratisthan Private Ltd. is the corporate

guarantor for the loan provided by STCI Finance Ltd. and Bohra

Industries Ltd.

21. The relevant section 3(11) and section 5(8) of the IBC, which

define „debt‟ and „financial debt‟ are relevant to the discussion here.

They are extracted hereunder: -

"Section 3(11): - „debt‟ means a liability or obligation in

respect of a claim which is due from any person and includes

a financial debt and operational debt."

"Section 5(8) :- „financial debt" means a debt alongwith

interest, if any, which is disbursed against the consideration

for the time value of money and includes -

(a) money borrowed against the payment of interest;

(b) any amount raised by acceptance under any Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 14 of 23 acceptance credit facility nor its de-materialized

equivalent;

(c) any amount raised pursuant to any note purchase

facility or the issue of bonds, notes, debentures,

loan stock or any similar instrument;

(d) the amount of any liability in respect of any lease

or hire purchase contract which is deemed as a

finance or capital lease under the Indian

Accounting Standards or such other accounting

standards as may be prescribed;

(e) receivables sold or discounted other than any

receivables sold on non-recourse basis;

(f) any amount raised under any other transaction,

including any forward sale or purchase

agreement, having the commercial effect of a

borrowing;

[Explanation: For the purposes of this sub-clause:-

(i) any amount raised from an allottee under a

real estate project shall be deemed to be an

amount having the commercial effect of a

borrowing; and

(ii) the expressions, "allottee" and "real estate

project" shall have the meanings Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 15 of 23 respectively assigned to them in clauses (d)

and (zn) of section 2 of the Real Estate

(Regulation and Development) Act, 2016 (16

of 2016);]

(g) any derivative transaction entered into in

connection with protection against or benefit from

fluctuation in any rate or price and for calculating

the value of any derivative transaction, only the

market value of such transaction shall be taken

into account;

(h) any counter indemnity obligation in respect of a

guarantee, indemnity, bond, documentary letter of

credit or any other instrument issued by a bank or

financial institution;

(i) the amount of any liability in respect of any of the

guarantee or indemnity for any of the items

referred to in sub-clauses (a) to (h) of this clause."

22. Thus liability arising out of guarantee for any of the items

referred in sub-clause (a) to (h) is Financial Debt. The requirement

for a debt to be a financial debt and such a creditor to be a

financial creditor has been explained very succinctly by Hon‟ble

Apex Court in Anuj Jain (supra). The relevant paragraphs are Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 16 of 23 extracted below:-

"46.Applying the aforementioned fundamental principles to

the definition occurring in Section 5(8) of the Code, we have not

an iota of doubt that for a debt to become "financial debt" for

the purpose of Part II of the Code, the basic elements are that

it ought to be a disbursal against the consideration for time

value of money. It may include any of the methods for raising

money or incurring liability by the modes prescribed in clauses

(a) to (f) of Section 5(8); it may also include any derivative

transaction or counter-indemnity obligation as per clauses (g)

and (h) of Section 5(8); and it may also be the amount of any

liability in respect of any of the guarantee or indemnity for any

of the items referred to in clauses (a) to (h). The requirement of

existence of a debt, which is disbursed against the

consideration for the time value of money, in our view, remains

an essential part even in respect of any of the

transactions/dealings stated in clauses (a) to (i) of Section 5(8),

even if it is not necessarily stated therein.

47. As noticed, the root requirement for a creditor to become

financial creditor for the purpose of Part II of the Code, there

must be a financial debt which is owed to that person. He Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 17 of 23 may be the principal creditor to whom the financial debt is

owed or he may be an assignee in terms of extended meaning

of this definition but, and nevertheless, the requirement of

existence of a debt being owed is not forsaken."

23. Later, in the same judgment Anuj Jain (supra), in Para 50.1

a distinction is made very categorically and logically between a

creditor who is having security interest over the assets of the

Corporate Debtor as against a financial creditor who has stake in

the Corporate Debtor's growth, and why inclusion of creditors who

only hold security interest over the assets of the corporate debtor

as financial creditor would be detrimental to the financial health of

the corporate debtor. This paragraph 50.1 is extracted below-

"50.1 Keeping the objectives of the Code in view, the

position and role of a person having only security interest over

the assets of the corporate debtor could easily be contrasted

with the role of a financial creditor because the former shall

have only the interest of realizing the value of its security

(there being no other stakes involved and least any stake in

the corporate debtor‟s growth or equitable liquidation) while

the latter would, apart from looking at safeguards of its own

interests, would also and simultaneously be interested in Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 18 of 23 rejuvenation, revival and growth of the corporate debtor. Thus

understood, it is clear that if the former i.e. a person having

only security interest over the assets of the corporate debtor is

also included as a financial creditor and thereby the growth

and revival of the corporate debtor may be the casualty. Such

result would defeat the very objective and purpose of the

Code, particularly of the provisions aimed at corporate

insolvency resolution."

24. In order to differentiate between the nature and

purpose of „mortgage‟ and „guarantee‟ with respect to a loan,

the Hon‟ble Apex Court proceeds to clarify in Anuj Jain

(supra) by holding that a mortgagee as a creditor shall be a

„secured creditor‟ but not a „financial creditor‟:-

"50.2 Therefore, we have no hesitation in saying

that a person having only security interest over the

assets of corporate debtor (like the instant third party

security), even if falling within the description of

„secured creditor‟ by virtue of collateral security

extended by the corporate debtor, would nevertheless

stand outside the sect of „financial creditors‟ as per the

definition contained in sub-section (7) and (8) of Section Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 19 of 23 5 of the Code. Differently put, if a corporate debtor has

given its property in mortgage to secure the debts of a

third party, it may lead to a mortgage debt and,

therefore, it may fall within the definition of "debt"

under Section 3(10) of the Code. However, it would

remain a debt alone and cannot partake the character of

a „financial debt‟ within the meaning of Section 5(8) of

the Code.

The respondent mortgagees are not the financial

creditors of corporate debtor JIL."

25. The Appellant‟s reliance on Anuj Jain (supra) in support of

his claim is, therefore, found to be out-of-context from the facts of

the instant case. We may look at the Ascot Realty (supra)

judgment of this tribunal, which in Para 25 deals with this issue

very comprehensively and cogently:-

"25. Before us, the learned counsel for the Appellant has

tried to read Para 43 of the judgment in the matter of Anuj

Jain (supra) to insist that Hon‟ble Supreme Court has held that

the requirement of disbursement against consideration of time

value of money is essential ingredient and this should be read

in the context of a guarantee also. At the same time, it has Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 20 of 23 also been argued that Section 5(8)(i) is not a standalone

provision. We refer to observations made by Hon‟ble Supreme

Court in this very judgment of Anuj Jain (supra) in Para 44.1.5

which reads as follows:-

"44.1.5. For taking into comprehension the ratio of

Pioneer Urban (supra) and for its application to the

question at hand, appropriate it would be to recount the

basic principles expounded and explained by a three-

judge bench in the case of Haryana Financial

Corporation and Anr. V. Jagdamba Oil Mills and Anr.

MANU/SC/0056/2002 : (2002) 3 SCC 496 that the

observations of the Court in a judgment are always

required tio be read in the context in which they appear.

This Court has said, -

"19. Courts should not place reliance on

decisions without discussing as to how the factual

situation fits in with the fact situation of the

decision on which reliance is placed.

Observations of courts are not to be read as

Euclid‟s Theorems nor as provisions of the statute.

These observations must be read in the context in Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 21 of 23 which they appear. Judgments of courts are not

to be construed as statutes. To interpret words,

phrases and provisions of a statute, it may

become necessary for judges to embark upon

lengthy discussions but the discussion is meant to

explain and not to define. Judges interpret

statutes, they do not interpret judgments. They

interpret words of statutes, their words are not to

be interpreted as statutes. In London Graving

Dock Co. Ltd. v. Horton : 1951 AC 737 (at p. 761)

Lord McDermot observed: (All ER p. 14C-D)

The matter cannot, of course, be settled merely by

treating the ipsissima verba of Wiles, J., as

though they were part of an Act of Parliament and

applying the rules of interpretation appropriate

thereto. This is not to detract from the great

weight to be given to the language actually used

by that most distinguished Judge."

26. We also find that SBI vs KusumBallabhdas Thakkar (supra)

supports the contention of the Respondent No. 2 in the instant

case.

Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 22 of 23

27. Looking to the detailed exposition of Anuj Jain (supra) and

Ascot Realty (supra) in the aforementioned paragraphs and the

facts of the present case, we are of very clear and unambiguous

view that on the basis of Corporate Guarantee given by BPPL for

the loan provided by STCI Finance Ltd. (Respondent No. 2) to BIL;

STCI Finance Ltd. is a financial creditor in the Corporate

Insolvency Resolution Process of the Corporate Debtor BPPL.

Finding no error in the Impugned Order we dismiss the Appeal.

28. There is no order as to costs.

(Justice A I S Cheema) The Officiating Chairperson

(Dr. Alok Srivastava) Member (Technical) New Delhi 13th July, 2021

/aks/

Company Appeal (AT) (Insolvency) No. 45 of 2021

Page 23 of 23