TMI Blog2022 (9) TMI 141X X X X Extracts X X X X X X X X Extracts X X X X ..... it does not fall within the definition of financial debt which is due and payable. HELD THAT:- The facts are not much in dispute but, during the course of the hearing, Counsel for the Respondent was pertinently asked to show any document available on record indicating the consent by the Appellant for converting her loan into capital contribution. It is pertinent to mention that no such document was shown by Counsel for Respondent. Thus, in view of the fact that the loan advanced by the Appellant has been converted into capital contribution without her consent cannot be treated as a capital contribution in order to dismiss the application filed under Section 7 of the Code by her. No other point has been raised. Appeal allowed by way ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rejected on the ground that the same set was filed by the Power of Attorney Holder. The delay has also been condoned by this Appellate Tribunal vide its order dated 24.01.2020. But the second issue as to whether the amount advanced was a loan or converted into equity was decided against the Appellant by observing that from the above provisions of law, it is latently and patently clear that once the Debt is converted into Capital it cannot be termed as Financial Debt and the Appellant cannot be described as Financial Creditor 3. Aggrieved against the order dated 02.09.2020, the present Appellant filed Civil Appeal No. 3511 of 2020 before the Hon ble Supreme Court. It was allowed on 25.02.2022 with the observation that apart fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Appellant is that the loan advanced by her has been converted into equity on 25.03.2014 contrary to the terms and conditions of loan agreement dated 09.07.2013. It is argued that there is no evidence on record to prove that the Appellant had ever consented for the conversion of the loan into capital contribution. It was a decision taken by the designated partners by way of a resolution dated 10.03.2014 in which it was also resolved to amend the clause 6(c) of the LLP supplementary agreement of the LLP executed on 13.04.2013 to convert the loan into capital contribution. It is further submitted that Ajit Kumar Mishra and Ajit Sinha are the designated partners whereas the Appellant is a general partner whose loan has been converted into ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... espondent. Thus, in view of the fact that the loan advanced by the Appellant has been converted into capital contribution without her consent cannot be treated as a capital contribution in order to dismiss the application filed under Section 7 of the Code by her. No other point has been raised. 10. In view of the aforesaid facts and circumstances, we are of the considered opinion that this appeal is meritorious and the same is hereby allowed and the impugned order is set aside. The matter is remanded back to the Adjudicating Authority for further proceedings after formally admitting the application filed under Section 7 of the Code by the Appellant. The parties are directed to appear before the Adjudicating Authority on 10th October, 202 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
