https://www.taxtmi.com/caselaws?id=760127 NCLAT dismissed appeal challenging admission of Section 7 application. Tribunal held that advance payment of Rs. 3.5 crores under Development Agreement constituted financial debt under Section 5(8) of IBC, 2016, as it carried 18% quarterly compounded interest indicating time value of money. Despite corporate debtor's classification of amount as inventory in books, transaction's commercial effect resembled borrowing. Adjudicating Authority correctly determined creditor as financial creditor rather than operational creditor, properly established debt and default, and rightly admitted the insolvency application without error warranting appellate interference. en-us Thu, 30 May 2024 00:00:00 +0530 Tue, 15 Oct 2024 17:59:54 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=760127 NCLAT dismissed appeal challenging admission of Section 7 application. Tribunal held that advance payment of Rs. 3.5 crores under Development Agreement constituted financial debt under Section 5(8) of IBC, 2016, as it carried 18% quarterly compounded interest indicating time value of money. Despite corporate debtor's classification of amount as inventory in books, transaction's commercial effect resembled borrowing. Adjudicating Authority correctly determined creditor as financial creditor rather than operational creditor, properly established debt and default, and rightly admitted the insolvency application without error warranting appellate interference. Case-Laws IBC Thu, 30 May 2024 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=760127