T.R. Jawahar & Anr vs Edelweiss Asset & Anr
- CitationCompany Appeal (AT) (Insolvency) No. 274 of 2017
Ratio decidendi
The rule this decision rests on
A party that is a trustee of a trust but is itself a company registered under the Companies Act, 1956 may file an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 in its own capacity as a "financial creditor", where it satisfies the definition of that term in sub-sections (7) and (8) of Section 5 of the Code; the fact that it acts as trustee does not prevent it from so qualifying. Where an application under Section 7 is filed by a financial creditor in that capacity and is complete, an appeal that merely contends the applicant filed in a representative capacity as trustee, without showing any defect in the application as filed, discloses no ground for interference with the Adjudicating Authority's order admitting the application.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
T.R. Jawahar & anr. ...Appellants
Versus
Edelweiss Asset & anr. ...Respondents
Present:
For Appellants: Shri Vivek Sibal, Ms. Pooja M. Saigal and Ms. Khyati, Advocates
For Respondents : Shri Sajeev Puri, Shri Dheeraj Nair and Shri Kunal Mimani, Advocates
ORDER
20.11.2017 This appeal has been preferred by T.R. Jawahar,
Shareholder/ Director of Frontline Printers Private Limited (Corporate Debtor)
and another against order dated 2nd November, 2017 passed by the Adjudicating
Authority (National Company Law Tribunal), Chennai in CP/606/(IB)/CB/2017
whereby and whereunder the application preferred by the respondent (Financial
Creditor)under Section 7 of the Insolvency and Bankruptcy Code, 2016
(hereinafter referred to as the 'I&B Code') read with Rule 4 of Insolvency and
Bankruptcy (Application to Adjudicating authority) Rules, 2016 has been
admitted, order of moratorium has been passed and the Interim Resolution
Professional (IRP) has been appointed with certain directions.
The only plea taken by the learned counsel for the appellants is that the
respondent(s) has filed the application under Section 7 of the I & B Code in the
Company Appeal (AT) (Insolvency) No. 274 of 2017 1 capacity of 'Trustee' and not as a 'Financial Creditor'. Reliance has been placed
on part-I of Form I wherein it mentioned that it is 'Acting in its capacity as
Trustee for EARC Trust SC-Trust-SC 19 (Series IV)'. However, on perusal of the
record, we find that in Part-I of Form I, it has been mentioned that the
respondent is a 'Financial Creditor'. Its date of incorporation as financial creditor
has been shown as 5th October, 2007 with the identification number as financial
creditor.
It is true that the respondent is a 'trustee' but we find that the respondent
is also a company registered under the Companies Act, 1956 and come within
the definition of 'Financial Creditor' as defined under sub-section (7) read with
sub-section (8) of Section 5 of the I & B Code.
In view of the fact that the respondent has filed the application in the
capacity of the 'Financial Creditor' and the application is complete, we find no
ground to interfere with the impugned order. In absence of any merit, the appeal
is dismissed. No cost.
[Justice S.J. Mukhopadhaya] Chairperson
[ Justice Bansi Lal Bhat ] [ Justice A.I.S. Cheema ] Member(Judicial) Member (Judicial)
/ns/uk
Company Appeal (AT) (Insolvency) No. 274 of 2017 2
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