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2021 (5) TMI 274 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors or not - Financial Debt or not - existence of debt and dispute or not - time limitation - HELD THAT:- The nature of transaction pursuant to the Investment Agreement and all other collateral transactions are that of investment based upon an 'Approved Business Plan' - It appears that as an Investor, the applicant herein had explored the possibility of making investment by taking calculated business risk. Many of the Clauses contained in the Investment Agreement demonstrate the fact that the Applicant is an 'Investor' and not a "Financial Creditor" within the meaning of the definition contained in the IBC. The allegation that the Corporate Debtor Company has not utilized the proceeds of investment in accordance with the approved business plan does not carry any merit in as much as the Board of the investee company consists of two nominee directors and an observer nominated by the investor in order to oversee the entire corporate documentation pertaining to various meetings and activities including meetings of the Board of Directors in order to safeguard the interest of the Investor Company. Therefore, the Investor cannot be and need not be treated as a "Financial Creditor". Whether the alleged debt is a 'financial debt' and applicant as a "financial creditor" under the provisions of Section 5(8) of the IBC? - HELD THAT:- Admittedly, the entire amount due and payable under the application arises out of Investment-cum-Shareholders Agreement dated 07.09.2013 which was subsequently and mutually agreed between the parties and a Settlement Agreement dated 06.09.2016 was arrived at. Further, the applicant admits that the entire amount as agreed between the parties has been repaid by the Corporate Debtor. This alleged amount mentioned in the application is only towards the outstanding interest between the parties arising out of the Settlement Agreement dated 06.09.2016. Hence, an Investment Agreement which subsequently converted into a Settlement agreement with a payment schedule between the parties fails to fall within the definition of a 'financial debt' and the Applicant herein is a not a "Financial Creditor" as per the provisions of the IBC. The Applicant has also hopelessly failed to satisfy, regarding "date of default". The alleged claim is not a 'financial debt' - Application dismissed.
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