Tribunal denies application under Insolvency Code, grants limited protection on property pending further hearing.

The Tribunal dismissed the application under Section 7 of the Insolvency and Bankruptcy Code, 2016, as the Appellant failed to prove the money given to the corporate debtor constituted financial debt. The Appellant requested an immediate stay on the sale of immovable property, citing NCLAT rules and previous judgments. The Tribunal granted limited protection by maintaining the status quo on the property until the next hearing to safeguard the parties' interests and ensure justice during further proceedings.

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Issues:
1. Dismissal of application under Section 7 of the Insolvency and Bankruptcy Code, 2016.
2. Appeal for immediate stay on the sale of immovable property by UBI and SIDBI.
3. Invocation of Section 11 of the NCLAT and relevant judgments.
4. Compliance with RBI Circular dated 19.12.2017.
5. Argument for protection of assets till disposal of the appeal.

Analysis:
1. The Appellant filed I.A. No. 955 of 2022 against the order dismissing the application under Section 7 of the Insolvency and Bankruptcy Code, 2016. The Adjudicating Authority found that the Appellant failed to prove the money was given to the corporate debtor, hence not constituting financial debt as per Section 5(8) and not meeting the definition of a financial creditor under Section 5(7) of the IBC.

2. The Appellant sought an immediate stay on the sale of the company's immovable property by UBI and SIDBI. Referring to NCLAT rules and previous judgments, the Appellant argued for interim relief under Rule 11, emphasizing the need to prevent the disposal of assets pending the appeal process.

3. Citing judgments in Company Appeal cases, the Appellant highlighted the power of the Adjudicating Authority to pass ad-interim orders before admitting applications under Section 7, 9, or 10 of the IBC. The Appellant relied on legal precedents to support the request for a stay on the property sale.

4. The Appellant referenced a Circular by the Reserve Bank of India, emphasizing the need for financial creditors to comply with the IBC and IBBI Regulations. This was presented to support the argument for the protection of assets and adherence to relevant legal provisions.

5. In consideration of the circumstances, the Tribunal granted limited protection to the Appellant by directing the maintenance of status quo on the subject property until the next hearing date. This decision aimed to safeguard the interests of the parties involved and ensure justice pending further proceedings.

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