https://www.taxtmi.com/caselaws?id=305286 Advance payments made for future supply of goods were later converted into a loan arrangement after the corporate debtor could not supply the goods, raising a question under the Insolvency and Bankruptcy Code on whether the transaction was preferential. The NCLAT noted that Section 43 requires satisfaction of statutory ingredients, including a transfer for the benefit of a creditor on account of antecedent debt and a resulting preference over Section 53 distribution. It also stressed that the matter could not be conclusively treated as preferential, or the related-party question decided, without a proper avoidance application and fresh examination of the transaction's true character. The impugned order was therefore set aside and the matter remanded for reconsideration. en-us Mon, 09 May 2022 00:00:00 +0530 Fri, 25 Nov 2022 22:10:11 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=305286 Advance payments made for future supply of goods were later converted into a loan arrangement after the corporate debtor could not supply the goods, raising a question under the Insolvency and Bankruptcy Code on whether the transaction was preferential. The NCLAT noted that Section 43 requires satisfaction of statutory ingredients, including a transfer for the benefit of a creditor on account of antecedent debt and a resulting preference over Section 53 distribution. It also stressed that the matter could not be conclusively treated as preferential, or the related-party question decided, without a proper avoidance application and fresh examination of the transaction's true character. The impugned order was therefore set aside and the matter remanded for reconsideration. Case-Laws Insolvency and Bankruptcy Mon, 09 May 2022 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=305286