Undervalued transactions defrauding creditors require restoration of assets while protecting good-faith third-party interests. Where a debtor has entered into an undervalued transaction deliberately to place assets beyond the reach of claimants or adversely affect their interests, the Adjudicating Authority must restore the pre-transaction position and protect victims of the transaction. The provision also protects good-faith third-party transferees and recipients who acquired property or benefits for value and without notice, unless they were parties to the transaction.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Undervalued transactions defrauding creditors require restoration of assets while protecting good-faith third-party interests.
Where a debtor has entered into an undervalued transaction deliberately to place assets beyond the reach of claimants or adversely affect their interests, the Adjudicating Authority must restore the pre-transaction position and protect victims of the transaction. The provision also protects good-faith third-party transferees and recipients who acquired property or benefits for value and without notice, unless they were parties to the transaction.
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