TMI Blog2022 (3) TMI 1397X X X X Extracts X X X X X X X X Extracts X X X X ..... s, and Financial Creditor is one of them - And as per the definition of Financial Creditor, only those creditors will be treated as a Financial Creditor, to whom a financial debt is owed and includes a person to whom such debt has been legally assigned or transferred. It is an admitted fact that the amount is not disbursed by the respondent no. 2 to the corporate debtor. Rather, the corporate debtor has simply executed the deed of guarantee, therefore, the IRP by filing an additional affidavit has rightly quoted the decision of the Anuj Jain's case [ 2020 (2) TMI 1259 - SUPREME COURT ] and submitted that since the IRP is not empowered to review the order, therefore, the same may be considered by the Adjudicating Authority. The Respondent No. 2 and 3 in their written submissions have contended that though there is a provision but the respondents have not appointed their nominee Director, which would be evident from the MCA data. As it is seen that part II of the Article of Association of the corporate debtor clearly says that in case of conflict between the two - the debenture holder will actively participate in the policy making process of the corporate debtor. There a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... approaching this Tribunal being aggrieved by the following acts of omission and commission of the Interim Resolution Professional and to seek appropriate directions from this Tribunal: a. Admitting the claims of Respondent No. 2 based on Corporate Guarantee even though there is no default by the principal borrower, for whose debt corporate guarantees were furnished by the Corporate Debtor. b. Inclusion of related party of the Corporate Debtor in the Committee of creditors. ii. Exclusion of interest from the claim of the Applicant and admitting the claims of the Applicant 'provisionally' a. That the Corporate Debtor is engaged in the business of real estate development and is developing a group housing residential complex at GH-05, SC-1, Adjoining Tech Zone IV, Greater Noida, Uttar Pradesh by the name 'Meghdutam Encore ('Project'). b. That the Corporate Debtor had furnished corporate guarantees for securing the Debentures issued by Saha Infratech Private Limited ( SIPL ). The Respondent No. 3 is the trustee to the issue and the debentures were initially subscribed by Kautilya Finance BV. Subsequently, sometime in the year 2017, the Res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orate Debtor. The Debenture holders not only formulate the business plan of the Corporate Debtor but also control the sales of inventory, bank accounts, salary and remuneration of the key managerial personnel of the Corporate Debtor etc. c. That the Debenture holders and lenders i.e., the Respondent No. 2 and 3 by virtue of such control are related party' of the Corporate Debtor and hence, could not have been included in the Committee of Creditors of the Corporate Debtor. d. That the Respondent No. 1 being the Interim Resolution Professional ought to have checked and confirmed, prior to admitting the Respondent No. 2 and 3 in the Committee of Creditors of the Corporate Debtor, that they are not 'related party' of the Corporate Debtor. 3. The Respondent No. 1 in his reply dated 19.03.2020 has submitted: i. That the Application filed by the Applicant is premature and therefore, untenable. The claim furnished by the Applicant vide Form CA (undated), was admittedly provisionally accepted by Respondent No. 1, Regulations 10, 12, 13 and 14 of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibes that the Applicant is entitled to compensation for delay @ Rs. 5 per sq. ft. per month for the super area of the premises in question. The Applicant had concealed and suppressed this fact in the Form CA (undated) furnished by the Applicant as well as in the present Application. iii. That the Applicant has no locus standi to raise objections and challenge the acceptance of the claims of other creditors including Respondent Nos. 2 and 3, without proper verification of facts. All creditors of the Corporate Debtor including Respondent Nos. 2 and 3, furnished their claim forms along with documents supporting their respective claims to the Respondent No. 1 of which the Applicant has no knowledge and his allegations accordingly are based on unverified information. In order to set the record straight, insofar as the claim of Respondent Nos. 2 and 3 are concerned, both have submitted their claims under 'Form C on 10.02.2020; to the Respondent No. 1. The Respondent No. 1 after receipt of the claims sought a legal opinion from his counsel M/s. Dua Associates, who after examining both claims in view of the precedents of the Hon'ble NCLAT have opined that the claims were admis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ur of ECL Finance Limited on various properties including but not limiting to first charge and mortgage over various projects, furnishing personal as well as corporate guarantees including an irrevocable and unconditional corporate guarantee from the Corporate Debtor and Pledge of its shares held by its shareholders in favour of ECL Finance Limited to secure the due performance of all the conditions of the Facility Agreement and payment of dues in accordance with the terms of the Facility Agreement. v. That in compliance with the conditions mentioned in the Facility Agreement, the Corporate Debtor vide Guarantee Agreement dated 22.09.2017 had extended a Corporate Guarantee in favour of ECL Finance Limited which vide the Assignment Agreement has been assigned to Assets Care and Reconstruction Enterprise Limited. vi. That the Corporate Debtor herein is not a mere surety in terms of the Guarantee Agreement, on the contrary the Corporate Debtor is also one of the Obligor under the Facility Agreement. There exists dual obligation on the Corporate Debtor i.e., as Obligor in terms of the Facility Agreement and to repay the outstanding amount to Respondent No. 2 under the Guarant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... highlighting the defaults and asking them to rectify the said defaults. x. That in pursuance of public announcement, on 7.02.2020 the Lender, ECL Finance Limited submitted its form C along with necessary documents, showing default from 2017 and claiming an amount of INR 139,02,83,168.68 as against the principal and interest due and payable. xi. That on 20.02.2020, the Insolvency Resolution Professional constituted Committee of Creditors in which the Lender ECL Finance was made a member with a status of Financial Creditor , as the claim submitted by it were valid claim in terms of the provisions of the Insolvency and Bankruptcy Code. xii. Thus, in terms of the clauses of the Facility Agreement as well the Guarantee Agreement, the Lender Respondent No. 2 (being the Assignee) falls within the ambit of Financial Creditor of Palm Developer Private Limited the Corporate Debtor herein Further, the terms of the Guarantee Agreement explicitly shows that in the event of any default in the part of Principal Borrower and/obligor in payment or repayment and reimbursement of any of the monies referred to in the same or in the event of any default on the part of Borrower and/or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a view of augmenting their resources for meeting the requirement of funds to carry their business operations, development of various Projects namely. Encore, Amadeus, Abet and Elicit offered to issue upto 160 numbers of senior, fully secured, redeemable, transferable and interest bearing Privately Placed non-convertible debentures ( Debentures ) having face value of INR. 1,00,00,000/-. each, for an aggregate amount of upto INR 160 Cores in two trenches, in the First Tranche the Issuer proposed to issue 110 Debentures and in the Second Tranche will issue 50 Debentures. The issuer accordingly appointed Respondent No. 3 10 act as the trustee for the holders of the Debentures vide Debenture Trustee Agreement dated 1.8.05.2016. ii. That at the request of the Issuer, Palm Developers Private Limited ( Corporate Debtor ) and their promoters, Debenture Holders agreed to subscribe to the Debentures. iii. That for the purpose of issuance of the said Debentures. Debenture Trust Deed dated 01.07.2016 containing the terms and conditions of the Debentures were executed among the Issuer, the Corporate Debtor and Respondent No. 3 (as a Debenture Trustee ) and other parties including the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nture Trust Deed, vii. That additionally, the Corporate Debtor has executed and delivered various documents including Demand Promissory Note, Indenture of Mortgage creating mortgage on properties of Encore project, Deed of Hypothecation hypothecating Encore project Receivables and Revenue Escrow Agreement in respect of entire receivables of the Encore Project, all dated 02.07.2016 in favour of Respondent No. 3 to secure the due performance of the terms and conditions and payment of all amounts under the Debenture Trust Deed, The documents have been filed by the answering Respondent with the Resolution Professional of the Corporate Debtor along with the claim of the answering Respondent viii. In terms of the Facility Agreement, the Principal Debtor and the Obligors were required to pay principal, interest and other dues and comply with other terms in accordance with the provisions contained in the Facility Agreement, However, the Principal Borrower and the Obligors committed, inter alia, the following defaults in performance of the terms of Loan Agreement ix. That the Respondent No. 3 vide communications dated 30.10.2018 bearing reference number ITSL/OPR/2018- 19/7155 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dent No. I dated 08.10.2020 has submitted that: i. No interest as contemplated by Regulation 16A(7) of the Insolvency and Bankruptcy Board of India (Corporate Insolvency Resolution Process for Corporate persons) Regulations, 2016 ( CIRP Regulations ) has been granted to the Applicant as well as the other allottees. ii. The Respondent No. 1 has only taken symbolic possession of the assets of the Palm Developers Private Limited ( Corporate Debtor ) whereas the Respondent No. 1 is required to take control and custody of the assets of the Corporate Debtor, as mandated by Section 18(1)(f) of the Insolvency and Bankruptcy Code, 2016 ( Code ) iii. Not a single piece of document has been produced by the Respondent No. 1 in support of the decision taken by him to include Respondent No. 2 and Respondent No. 3 in the Committee of Creditors. Respondent No. 1 purports to rely upon extracts of legal opinion allegedly obtained by him. Without prejudice to the contention that the Respondent No. 2 and Respondent No. 3 has not disbursed any amount to the Corporate Debtor and hence, not entitled to be on the Committee of Creditors, the Applicant submits that the Respondent No. 1 has fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, ACRE has not been able to show any disbursement to the Corporate Debtor It is further submitted that the Respondent No. 2 cannot be a part of the Committee of Creditors. iv. It is further submitted that not a single document has been produced by ACRE to establish any default by Saha Infratech Pvt. Ltd. (Principal Borrower/SIPL). No account statement is produced by ACRE to even try and establish the default by SIPL. v. Further, the Respondent No. 2 has been wrongly included in the Committer of Creditors of the Corporate Debtor. Respondent No. 2, who is also the debenture holder of the debentures issued by SIPL controls all facets of business, including composition of Board of Directors of the Corporate Debtor, as would be evident from the Articles of Association of the Corporate Debtor. Hence, the Respondent No. 2 is a related party of the corporate debtor and could have not been included in the CoC of the corporate debtor. vi. The Respondent No. 3 has filed the claim as agent of the Debenture Holders. As would be evident from the letter dated 15.06.2017 issued by Respondent no. 3 Respondent no. 2 was the sole debenture holder and the respondent No. 2 further gave ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Kumar Singh, was removed as the IRP, on an application preferred by the IBBI, white the answering respondent was appointed by this Tribunal. On his appointment, the answering respondent observed that amongst the CoC, so constituted were ECL Finance Ltd. and IDBI Trusteeship Services Ltd. (Respondent Nos. 2 and 3), who are holders of corporate guarantee executed by the corporate debtor for financial assistance being enjoyed by Shah Infratech Pvt. Ltd. (principal borrower). On admitting the respondent nos. 2 and 3 in the CoC, they held about 88% voting share in the CoC. iii. The admission of claims of the respondent nos. 2 and 3 has been challenged by the applicant herein in the captioned application. primarily on the grounds that there is no disbursement of financial debt by the respondent nos. 2 and 3 to the corporate debtor and further that the corporate guarantee executed by the corporate debtor in favour of the said respondents has not been invoked. iv. It is a matter of record that the respondent nos. 2 and 3 hold corporate guarantees executed by the corporate debtor in respect of the said principal borrower, in this regard, the project land of the corporate debtor h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o challenge the claims of the respondent Nos. 2 and 3 that have been already admitted by the erstwhile interim resolution professional. iii. Further, it is submitted that the IRP has filed the present additional reply without disputing the reply filed by erstwhile IRP, hence the present IRP is estopped from taking a contradictory stand in facts and law in the captioned application. iv. It is submitted that the IRP in his additional affidavit in reply has failed to disclose any reason or justification whatsoever for him to file such additional reply despite the detailed reply filed by erstwhile IRP being on record. v. It is submitted that Mr. Krit Narayan Mishra has sought to contest the answering Respondents status as financial creditor by referring to Section 5(8) of the code. The IRP has relied upon the judgment passed by the Hon'ble Supreme Court in' Anuj Jain Interim Resolution Professional for Jaypee Infratech Ltd. Vs. Axis Bank' cited in 2020 (8) SCC 401. It is an admitted position that the claims of the Respondent Nos. 2 and 3 against the Corporate Debtor are based on the guarantees furnished by the Corporate Debtor in favour of the Respondent Nos. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ongly relied upon the judgment mention herein above ( Anuj Jain Interim Resolution Professional for Jaypee Infratech Ltd., Vs. Axis Bank ) as the facts of the present case are different and the Hon'ble NCLAT has cleared the air as such that the above mentioned judgment does not apply in respect of guarantee. ix. It is further submitted that the position in Ascot Realty (supra) has been reaffirmed by NCLAT in the recent judgment in the case of 9M Corporation v. Naresh Verma: Co. Appeal (AT) (Ins) 45/2021. x. Respondents are entitled to claim the entire outstanding amounts under their transaction documents including guarantees offered by the Corporate Debtor ( PDPL ). The rights of Respondents to claim against PDPL. which is also a corporate guarantor, is available even without taking any prior action against the principal borrower. xi. The Hon'ble NCLAT in its order dated 08.01.2019 passed in Ferro Alloys Corporation Ltd. Vs. Rural Electrification Corporation Ltd. held that insolvency proceedings can be initiated against the corporate guarantor without initiating corporate insolvency process against the corporate debtor . It is submitted that the said c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orate Debtor herein in respect of the aforesaid credit facilities for all purposes. ii. The Applicant No. 2 is now vested with full and absolute rights of a legal owner of the financial assets and securities of the Applicant No. 1 qua the Facility Agreement dated 22.09.2017 including the Guarantee Agreement dated 22.09.2017 executed by the Corporate Debtor and the securities created by the Corporate Debtor to secure the said financial assistance and hence is entitled to receive the repayment of debt as well as to collect and enforce payments from the Corporate Debtor Company being the Obligor and the Guarantor. iii. It is submitted that the proposed addition and substitution will not cause any prejudice or adversely affect the captioned proceedings or to the Applicants, however if the present application is not allowed irreparable harm and injury will be caused to the Applicants herein. 16. The Applicant No. 2 has filed an additional affidavit dated 20.01.2021 for submission of additional documents i.e., Assignment Deed dated 27.03.2020, pursuant to the direction of this Hon'ble Tribunal in its order dated 19.01.2021. 17. The Applicant in IA 1610/2020, Abhin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tor, the SIPL, ECL and IDBI Trusteeship Limited ( IDBI ) recalled the loan only on 24.03.2020 and 25.03.2020, respectively i.e., alter the CIRP commencement date. Since the Applicant Abhinav Mukerji had raised the issue of ECL being a related party of the Corporate Debtor. ECL has purportedly attempted to assign the loans advanced to SIPL only with malafide to circumvent the prospect of it being relegated as a 'related party of the Corporate Debtor. iii. That the documents filed by ACRE show that the default of the Principal Borrower as on the CIRP commencement date was only Rs. 3,11,75,000/- while the documents filed by IDBI show that the default was only Rs. 9,16,66,666/-. However, in the CIRP of the Corporate Debtor, ACRE has filed a claim of Rs. 1,39,02,83,169/- while IDBI has filed a claim of 1,26,96,88,698/- out of which the erstwhile IRP had illegally admitted a claim of Rs. 89,39,72,602/- for ACRE and Rs. 97,27,02,627/- for IDBI. iv. Thus, the Assignment Agreement purportedly executed between ECL and ACRE is null and void and no rights can be said to have been assigned in favour of ACRE and hence, the prayer for substitution of ECL by ACRE should be rejected. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h bank or NBFC shall vest in such ARC in relation to such financial assets. Accordingly vide assignment deed dated 27.03.2020, ACRE ARC (assignee) has stepped into the shoes of ECL Finance Ltd.(assignor) as against the principal borrower i.e., Saha Infratech Pvt. Ltd. and all other securities in relation to the said financial assistance including Corporate Guarantor i.e., Corporate Debtor in the present matter. It referred to Section 35 of SARFAESI Act over-riding provisions of SARFAESI Act over any other inconsistent law. iv. It is submitted that the Assignment Deed is valid and duly registered under the Registration Act 1908 Certificate under Section 60(2) of the Registration Act, 1908 has been issued by the Registering Authority and the document is admissible to prove that it is registered under the Act, No further compliance is required to be shown for admissibility. The objections and allegations with respect to the registration of the assignment deed and the jurisdiction for such registration are false, baseless and vehemently denied. v. It is submitted that even otherwise Section 29 (1) of the Registration Act 1908 itself provides that Every document not being a d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the claims by the IRP based on corporate guarantee even though there is no default by the principal borrower, for whose debt, the corporate guarantee is furnished by the Corporate Debtor. And Second ground relates to inclusion of related party of the Corporate Debtor in the Committee of Creditors (COC) and the exclusion of interest from the claim of the Applicant. 22. Since, the admission of claims of ECL Finance Ltd. of Respondent No. 2 of IA 1610/2020 as well as Respondent No. 3 as a financial creditor are under challenge on the grounds referred above, therefore, before considering the prayer of substitution of the Applicant of IA 4130/2020, it would be proper to consider the issue of treating the Respondent No. 2 and 3 of IA 1610/2020 as a 'Financial Creditors' and their inclusion in the COC as Financial Creditors. 23. We have perused the averments made in the amended application IA No. 1610/2020 filed by the Applicant, the reply filed by the Respondents as well as the additional reply filed by the Respondent No. 1 and the written submissions filed on behalf of the Applicant and the Respondents, and we observe- a. That the contention of the Applicant is th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) right to remedy for breach of contract under any law for the time being in force, if such breach gives rise to a right to payment, whether or not such right is reduced to Judgment, fixed, matured, unmatured, disputed, undisputed, secured or unsecured; 6. Section 3(10) Creditor, (10) creditor means any person to whom a debt is owed and includes a Financial Creditor an Operational Creditor, a secured creditor, an unsecured creditor and a decree-holder; c. Section 3(11) debt, (11) (debt means a liability or obligation in respect of a claim which is due from any person and includes a financial debt and operational debt; d. Section 5(22) Personal Guarantor, (22) 'personal guarantor means an individual who is the surety in a contract of guarantee to a Corporate Debtor; e. Section 5(8) Financial Debt, (8) 'financial debt means a debt alongwith interest, if any, which is disbursed against the consideration for the time value of money and includes- (a) money borrowed against the payment of interest; (b) any amount raised by acceptance under any acceptance credit facility or its dematerialised equivalent; (c) any amount r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irector and holds along with his relatives, more than two per cent, of its share capital; (e) a public company in which a director, partner or manager of the Corporate Debtor is a director and holds along with relatives, more than two per cent of its paid' up share capital; (f) anybody corporate whose board of directors, managing director or manager, in the ordinary course of business, acts on the advice, directions or instructions of a director, partner or manager of the Corporate Debtor; (g) any limited liability partnership or a partnership firm whose partners or employees in the ordinary course of business, acts on the advice, directions or instructions of a director, partner or manager of the Corporate Debtor, (h) any person on whose advice, directions or instructions, a director, partner or manager of the Corporate Debtor is accustomed to act; (i) a body corporate which is a holding, subsidiary or an associate company of the Corporate Debtor, or a subsidiary of a holding company to which the Corporate Debtor is a subsidiary; (j) any person who controls more than twenty per cent of voting rights in the Corporate Debtor on account of ownership ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 5(8); it may also include any derivative transaction or counter-indemnity obligation as per sub-clauses (g) and (h) of Section 5(8); and it may also be the amount of any liability in respect of any of the guarantee or indemnity for any of the items referred to in subclauses (a) to (h). The requirement of existence of a debt, which is disbursed against the consideration for the time value of money, in our view, remains an essential part even in respect of any of the transactions/dealings stated in sub-clauses (a) to ft) of Section 5(8), even if it is not necessarily stated therein. In any case, the definition, by its very frame, cannot be read so expansive, rather infinitely wide, that the root requirements of 'disbursement against 'the consideration for the time value of money' could be forsaken in the manner that any transaction could stand alone to become a financial debt In other words, any of the transactions stated in the said subclauses (a) to (i) of Section 5(8) would be falling within the ambit of financial debt' only if it carries the essential elements stated in the principal clause or at least has the features which could be traced to such essential e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncludes' in these clauses, on the very same principles of interpretation as indicated above, makes it clear that for a person to become a creditor, there has to be a debt i.e., a liability or obligation in respect of a claim which may be due from any person. A 'secured creditor' in terms of Section 3(30) means a creditor in whose favour a security interest is created; and 'security interest , in terms of Section 3(91), means a right, title or interest or claim of property created in favour of or provided for a secured creditor by a transaction which secures payment for the purpose of an obligation and it includes, amongst others, a mortgage. Thus, any mortgage created in favour of a creditor leads to a security interest being created and thereby, the creditor becomes a secured creditor. However, when all the defining douses are read together and harmoniously, it is dear that the legislature has maintained a distinction amongst the expressions 'Financial Creditor', Operational Creditor', 'secured creditor' and 'unsecured creditor'. Every secured creditor would be a creditor; and every Financial Creditor would also be a creditor but every s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecurity interest over the assets of the Corporate Debtor is also included as a Financial Creditor and thereby allowed to have its say in the processes contemplated by Part. II of the Code, the growth and revival of the Corporate Debtor may be the casualty. Such result would defeat the very objective and purpose of the Code, particularly of the provisions aimed at corporate insolvency resolution. 47.2. Therefore, we have no hesitation in saying that a person having only security interest over the assets of Corporate Debtor (like the instant third party securities), even if falling within the description of 'secured creditor' by virtue of collateral security extended by the Corporate Debtor, would nevertheless stand outside the sect of 'Financial Creditors' as per the definitions contained in sub-sections (7) and (8) of Section 5 of the Code Differently put, if a Corporate Debtor has given its property in mortgage to secure the debts of a third party, it may lead to a mortgage debt and, therefore, it may full within the definition of 'debt' under Section 3(10) of the Code. However, it would remain a debt alone and cannot partake the character of a financi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ditor and Corporate Debtor under Part II of the Code and provision for a debtor or creditor under Part III of the Code is based on the definition of Creditor under Section 3(10) of the IBC. 2016, which clearly makes a distinction between the creditor and a Financial Creditor or the Operational Creditor. And that is the reason, the Hon'ble Supreme Court in Para 43 of the Anuj Jain's Case expressly used the word Part II of the Code, At the cost of repetition, we would like to reproduce the relevant portion of the decision - it becomes clear that a third party to whom the Corporate Debtor does not owe a financial debt cannot become its Financial Creditor for the purpose of Part II of the Code. 36. Hence, we are of the considered view that the decision, upon which the Respondent No. 2 and 3 have placed reliance, under the facts and circumstances of the case, is not applicable. Rather, the decision of Hon'ble Supreme Court in Anuj Jain's Case has made it crystal clear that for the purpose of Part II of the Code, 'disburse' of the amount by the creditor to the debtor is the condition precedent to became a debt us 'financial debt' under section 5(8) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of related party, what is required to be established is, whether a person is in a position to control the composition of the Board of Directors and it is not necessary that he/they is/are the director(s) of the corporate debtor or not. Hence, we are unable to accept the contention of the Respondent no. 2 and 3 that they have not nominated any Director as yet and they are not in a position to take part in the policy making process. 41. For the reasons discussed above, we are of the considered view that in terms of the AOA, since the Respondents no. 2 and 3 are in a position to have control over the policy decisions of the corporate debtor and on the composition of the board of directors, hence they are related parties in terms of section 5(24) of the IBC, 2016. 42. At this juncture, we would also like to refer to the arguments advanced on behalf of the Ld. Counsels appearing for the Respondent No. 2 and 3 that the verification of the claims can be made by the IRP only and Adjudicating Authority is not required to interfere. 43. We ore unable to accept this contention of the Respondent No. 2 and 3 as the duty of the IRP is only to verify the claims and in case, if any ..... X X X X Extracts X X X X X X X X Extracts X X X X
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