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2019 (12) TMI 893 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor defaulted in making repayment - Financial Debt - whether any coupon rate is prescribed or not comes within the 'financial debt'? - HELD THAT:- This Tribunal is of the view that both at the time of initial agreement dated 28.03.2011 as well as under the Amendment Agreements, the 'Investor Debentures' being a part of 'Investor Securities' falls within the definition of 'Financial Debt' as 'debentures' by its very nature, taking into consideration the provisions of Section 3(30) of the Companies Act, 2013, of which this Tribunal can take recourse to in the absence of any definition contained in IBC, 2016 of 'debentures' in view of Section 3(37) of IBC, 2016, is defined to include debenture stock, bonds or any other instrument of a company evidencing a debt, whether constituting a charge on the assets of the company or not, the 'debt' which was due and payable, when the event of default happened in the instant case as per the agreements prior to settlement agreement in the year 2015 and hence the contention that the Petitioner cannot be considered as a 'Financial Creditor' or the amount claimed as a 'Financial Debt' is not acceptable. The Settlement Agreement is only a sequel to the earlier agreements under which investments were made, and in any case the Settlement Agreement treats the total amount as a 'debt' payable with interest cannot be denied by the Corporate Debtor in the capacity as a promoter/developer as both of them/all of them are jointly and severally liable for the amounts due to the Financial Creditor having signed the agreements jointly and in the circumstances the contention that no privity of contract exists as between the parties raised by the Corporate Debtor cannot also be accepted. Thus when repayment was demanded and since there has been no repayment till date, whether it be of 'debenture' or 'loan' being attendant with payment of interest or not, as agreed between the parties and the amount being disbursed against the consideration for the time value of money thereby falling within the definition of 'Financial Debt' and there is default in repayment of the 'financial debt' and that a default has been committed in terms of Section 3(12) of the Code of a 'financial debt' as defined under Section 5(8) of the Code and that the Applicant has rightly invoked the provisions of the Code. Application admitted - moratorium declared.
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