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2017 (8) TMI 1646 - NATIONAL COMPANY LAW TRIBUNAL HYDERABAD BENCHMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - Inter-corporate loan falls under Section 5(8) (f) of the IBC or not - Section 7 of Insolvency and Bankruptcy Code 2016, read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 - HELD THAT:- With regard to the contention/submission of the Respondent, the amount disbursed to Corporate Debtor is not part of the balance sheet of Financial Creditor, while perusing the records submitted by the Corporate Debtor itself, we have observed / found the Audited Reports for year ending 31-12-2009 of Quinn Logistics India Pvt. Ltd (Financial Creditor) under the heading current assets / loans and advances, an amount of ₹ 63,15,88,023/- was shown as loans and advances and also previous year ending 31-12-2008, an amount of ₹ 74,80,26,336/- was also shown as loans and advances. While further analyzing the schedules of balance sheet, the same was discussed in Schedule-8 and said amount was against the name of Mack Soft Tech Pvt. Ltd. i.e. the Corporate Debtor, therefore, even in this count also the Corporate Debtor have failed and in addition to the balance sheet, the Financial Creditor have also submitted the bank statement, establishing the proof of loans disbursement to Corporate Debtor. The Corporate Debtor was enjoying Inter Corporate Loan granted by the Financial Creditor as interest free loan for quite a number of years and they should be happy with the same. It is also unique to observe that the borrower after enjoying the interest free loan for so many years instead of repaying the debt - The Financial Creditor was a holding company of the Corporate Debtor in the beginning and during the course of period the loans were disbursed free of interest. Section 5(8) of IBC Code also states that the Financial debt means a debt along with interest if any. The Accounting Standard relied upon by Corporate Debtor is not related to the current facts & circumstances of the case since the accounting standard states that "when the obligation specified in the contract is discharged or cancelled or expires - Apparently, in the instant case there are no obligations specified, more over the petitioner itself accepted that there is no written agreement between the petitioner and Corporate Debtor. Further, the term "Expires" stated in the aforesaid accounting standard, there is no corresponding provision stating that the same is governed by Limitation Act, 1963. Therefore, even this contention of the respondent does not help them. The Bench is of the prima facie view that to avoid disputes like in this case it would be advisable/beneficial/for audit trials for all to enter into an agreement with detailed terms & conditions including the schedule of the repayments, interest charged etc. However, in the present case, the Financial Creditor and Corporate Debtor had Holding/Subsidiary Company relationship and the Financial Creditor also submitted the bank statements towards disbursement of loan/money to Corporate Debtor and in balance sheet for the year ending 31.12.2009. The Corporate Debtor owes ₹ 62,90,45,905/- therefore, debt and default has been established by the Financial Creditor - Financial Creditor has to receive ₹ 62,90,45,905/- which is the debt &default amount. Therefore, there is a default by the Corporate Debtor and thus the Financial Creditor is entitled to claim relief under section 7 of the IBC, 2016. Application admitted - moratorium declared.
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