ICICI Bank UK PLC affirmed as financial creditor under Insolvency & Bankruptcy Code

The Tribunal held that ICICI Bank UK PLC qualifies as a 'Financial Creditor' under the Insolvency & Bankruptcy Code as the Corporate Debtor undertook obligations acknowledging the debt. The debt claimed was found payable by the Corporate Debtor due to its obligations in agreements. The 'Debt Asset Swap Agreement' and 'Multi-Party Undertaking' were deemed valid, creating a liability for repayment. The claim was not barred by limitation as ongoing obligations extended the period. The Tribunal affirmed ICICI Bank UK PLC's status as a creditor, dismissing the appeal with no costs awarded.

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Issues Involved:
1. Whether ICICI Bank UK PLC qualifies as a 'Financial Creditor' under the Insolvency & Bankruptcy Code, 2016.
2. Whether the debt claimed by ICICI Bank UK PLC is payable by the Corporate Debtor.
3. Validity and implications of the 'Debt Asset Swap Agreement' and 'Multi-Party Undertaking'.
4. Whether the claim by ICICI Bank UK PLC is barred by limitation.

Issue-wise Detailed Analysis:

1. Whether ICICI Bank UK PLC qualifies as a 'Financial Creditor' under the Insolvency & Bankruptcy Code, 2016:

The appellant contended that ICICI Bank UK PLC cannot be considered a 'Financial Creditor' of the Corporate Debtor as the loan was given to M/s Assam Oil Company Limited, an overseas company, and not to the Corporate Debtor. The Corporate Debtor neither guaranteed the loan nor mortgaged any property for it. However, the Tribunal found that ICICI Bank UK PLC had a valid claim as a 'Financial Creditor' because the Corporate Debtor had undertaken obligations under various agreements, including the 'Debt Asset Swap Agreement' and 'Multi-Party Undertaking', which acknowledged the liability towards ICICI Bank UK PLC.

2. Whether the debt claimed by ICICI Bank UK PLC is payable by the Corporate Debtor:

The appellant argued that there was no debt payable to ICICI Bank UK PLC by the Corporate Debtor as per the definitions in the I&B Code. The Tribunal examined the 'Facility Agreement' dated 21st December 2007 and its amendments, which defined the Corporate Debtor as a 'Relevant Person' obligated to make payments. The Tribunal concluded that the Corporate Debtor's assets were integral to the loan arrangement, and thus, the Corporate Debtor was obliged to repay the amount outstanding to ICICI Bank UK PLC.

3. Validity and implications of the 'Debt Asset Swap Agreement' and 'Multi-Party Undertaking':

The appellant submitted that the 'Debt Asset Swap Agreement' was not a guarantee and that the sale of the property could only occur if the price was above the 'Reserve Price'. The Tribunal noted that the 'Debt Asset Swap Agreement' and 'Multi-Party Undertaking' clearly created an obligation for the Corporate Debtor to repay the loans availed by M/s Assam Oil Company Ltd from ICICI Bank UK PLC. The Tribunal emphasized that the Corporate Debtor had acknowledged this liability by amending its 'Articles of Association' to include ICICI Bank UK PLC as a lender.

4. Whether the claim by ICICI Bank UK PLC is barred by limitation:

The appellant claimed that the loan default by M/s Assam Oil Company Ltd occurred on 28th December 2011, and thus, the claim was barred by limitation. However, the Tribunal did not find merit in this argument, as the obligations under the 'Debt Asset Swap Agreement' and the 'Multi-Party Undertaking' were ongoing and acknowledged by the Corporate Debtor, thereby extending the limitation period.

Conclusion:

The Tribunal concluded that ICICI Bank UK PLC is a 'Financial Creditor' of the Corporate Debtor and that the application under Section 7 of the I&B Code was rightly admitted by the Adjudicating Authority. The appeal was dismissed with no order as to costs.

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