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Category II AIF pass-through taxation preserves non-business income character; investment receipts cannot be reclassified without applying recognised ...
The account of the borrower was classified as a Non-Performing Asset (NPA) on the relevant date. The transfer of the financial asset by the State Bank of India (SBI) to the Asset Reconstruction Company (ARC) is valid. The High Court's impugned judgment and order dated October 5, 2023 is set aside, and the appeal is allowed. The date on which the account should be considered as NPA for a sale u/s 5 of the Act of 2002 would be the date of publication of the web notice, not the date of NPA mentioned in the notice u/s 13(2). SBI's action in putting up the financial assets for sale and ultimately assigning them to the ARC cannot be faulted, as it did not violate any binding Reserve Bank of India (RBI) Directions. The borrower, who did not respond to the notice u/s 13(2), failed to discharge the burden of proof rebutting the presumption that the account became NPA on the date of the web notice.
The account of the borrower was classified as a Non-Performing Asset (NPA) on the relevant date. The transfer of the financial asset by the State Bank of India (SBI) to the Asset Reconstruction Company (ARC) is valid. The High Court's impugned judgment and order dated October 5, 2023 is set aside, and the appeal is allowed. The date on which the account should be considered as NPA for a sale u/s 5 of the Act of 2002 would be the date of publication of the web notice, not the date of NPA mentioned in the notice u/s 13(2). SBI's action in putting up the financial assets for sale and ultimately assigning them to the ARC cannot be faulted, as it did not violate any binding Reserve Bank of India (RBI) Directions. The borrower, who did not respond to the notice u/s 13(2), failed to discharge the burden of proof rebutting the presumption that the account became NPA on the date of the web notice.
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