https://www.taxtmi.com/caselaws?id=428274 A claim in insolvency cannot be rejected merely because internal correspondence suggests a possible adjustment or because an unaudited balance sheet omits the loan, unless the record shows actual discharge of the debt by a legally effective transaction. Here, the letters only reflected a request for assistance and a proposed adjustment, while the transaction entries indicated payment by the sister concern followed by a fresh disbursement, not extinction of the corporate debtor's liability. The plea of collusion also failed for want of any finding that the loan transaction was sham or collusive. The rejection of the claim was therefore unsustainable, and the claim was directed to be admitted. en-us Mon, 19 Sep 2022 00:00:00 +0530 Wed, 28 Sep 2022 10:02:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=428274 A claim in insolvency cannot be rejected merely because internal correspondence suggests a possible adjustment or because an unaudited balance sheet omits the loan, unless the record shows actual discharge of the debt by a legally effective transaction. Here, the letters only reflected a request for assistance and a proposed adjustment, while the transaction entries indicated payment by the sister concern followed by a fresh disbursement, not extinction of the corporate debtor's liability. The plea of collusion also failed for want of any finding that the loan transaction was sham or collusive. The rejection of the claim was therefore unsustainable, and the claim was directed to be admitted. Case-Laws Insolvency and Bankruptcy Mon, 19 Sep 2022 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=428274