Supreme Court dismisses appeal after NCLAT upholds that IFMS amount does not constitute financial debt under Section 7

The SC dismissed the appellant's civil appeal challenging NCLAT's decision. The appellant had filed an application under Section 7, but it was rejected on grounds that the IFMS amount did not constitute financial debt. NCLAT upheld the Adjudicating Authority's finding that IFMS does not amount to financial debt, determining this conclusion was without infirmity. The SC found no good reason to entertain the appeal and accordingly dismissed it.

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The Supreme Court, in a bench comprising Hon'ble Mr. Justice Ujjal Bhuyan and Hon'ble Mr. Justice K. Vinod Chandran, addressed a Civil Appeal challenging the rejection of an application under Section 7 by the National Company Law Tribunal (NCLT), New Delhi. The NCLT had held that the amount in question, the Interest-Free Maintenance Security (IFMS), "does not amount to financial debt." This finding was affirmed by the National Company Law Appellate Tribunal (NCLAT). Upon review, the Supreme Court found no merit to interfere and thus dismissed the appeal, stating "no good reason to entertain this Civil Appeal." The Court also ordered that all pending applications stand disposed of. Delay in filing was condoned.

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