https://www.taxtmi.com/caselaws?id=312203 The NCLAT held that investment made in SPV/Joint Venture through Share Subscription Shareholders Agreement does not fall within Section 7 read with Section 5(8) of the IBC. The tribunal established that for Section 7 application, there must be actual disbursal of funds by the Financial Creditor to Corporate Debtor. Key requirements include: creditor must be a Financial Creditor under Section 5(7)(8), Financial Debt must be owed by Corporate Debtor, debt must carry interest element for time value of money, and money must be borrowed against interest payment. Investment for profit sharing from revenue and amounts from arbitration awards or settlement agreements are excluded from Section 7 purview. The Adjudicating Authority's order was set aside and appeal allowed. en-us Tue, 02 Aug 2022 00:00:00 +0530 Tue, 06 Feb 2024 23:10:17 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=312203 The NCLAT held that investment made in SPV/Joint Venture through Share Subscription Shareholders Agreement does not fall within Section 7 read with Section 5(8) of the IBC. The tribunal established that for Section 7 application, there must be actual disbursal of funds by the Financial Creditor to Corporate Debtor. Key requirements include: creditor must be a Financial Creditor under Section 5(7)(8), Financial Debt must be owed by Corporate Debtor, debt must carry interest element for time value of money, and money must be borrowed against interest payment. Investment for profit sharing from revenue and amounts from arbitration awards or settlement agreements are excluded from Section 7 purview. The Adjudicating Authority's order was set aside and appeal allowed. Case-Laws Insolvency and Bankruptcy Tue, 02 Aug 2022 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=312203