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2022 (11) TMI 1074 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHIWhether the Appellant is a ‘related party’ of the Corporate Debtor? - Section 5(24) of IBC - objection was raised by a Member of CoC that Appellant being ‘related party’ cannot be part of the CoC. HELD THAT:- Memorandum of Understanding, which is admittedly executed between the parties on 26.11.2012, i.e., between the Appellant and the Corporate Debtor. The MoU provides “AND WHEREAS the Second Party has offered to participate in development of the said project by way of bringing in funds into the said project”. Under the MoU, the Second Party is Appellant before us - the clauses of the MoU clearly indicate that the MoU was nothing but a Joint Venture between the parties. Further, the only project of the Corporate Debtor is the project referred to in MoU dated 26.11.2012. The ‘control’ as envisaged under Section 2(27), participation in the policy decision is also indica of control. The expression ‘control’ came to be considered by the Hon’ble Supreme Court in ARCELORMITTAL INDIA PRIVATE LIMITED VERSUS SATISH KUMAR GUPTA & ORS. [2018 (10) TMI 312 - SUPREME COURT] - the Hon’ble Supreme Court in the above judgment while discussing the policy decision observed that policy decision would be that decision that would be beyond running day-to-day decisions, i.e., long term decisions. From the clauses of the MoU as noted above, it is clear that decision pertaining to pricing has to be taken with the mutual consent. Thus, there is sufficient control of the Appellant as envisaged in provisions of law. The Appellant being Joint Venture Company of the Corporate Debtor was clearly ‘related party’ and no error has been committed by IRP in declaring the Appellant as ‘related party’. The present is a case, which cannot be said to be a case where IRP has suo-moto changed its decision. The IRP has corrected its earlier decision of admitting the claim of Financial Creditor by changing the category of Appellant as related Financial Creditor. What was held by this Tribunal was that RP cannot change the status of existing creditor on his own. The RP has to maintain an updated list of claims and is entitled to correct the errors, if any, in accepting or rejecting the claim. Further, it is not a case that IRP on his own has changed the category of Appellant. Rather, it was done on the objection of the Punjab National Bank, the Member of CoC, which objection was raised in the very First Meeting of the CoC held on 24.11.2021. Thus, present is not a case where IRP has reviewed its decision - there is no error in the decision of the IRP, changing the category of the Appellant from Financial Creditor to related Financial Creditor. The decision of the IRP has correctly been analysed by the Adjudicating Authority and has received its approval. Appeal dismissed.
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