https://www.taxtmi.com/caselaws?id=788783 An accounting adjustment that extinguishes a corporate debtor's receivable in favour of a related party can constitute a preferential transfer under Section 43 of the Insolvency and Bankruptcy Code, even without physical movement of funds. The tribunal treated the square-off and offsetting entries as a transfer because they reduced the debtor's asset pool and satisfied dues of entities under common control. It also found the transaction fell within the relevant look-back period for related parties. The plea that the adjustment was in the ordinary course of business failed, as the entry bypassed banking channels, lacked corporate authorisation, and was not a routine commercial transaction. en-us Wed, 25 Mar 2026 00:00:00 +0530 Sat, 28 Mar 2026 08:57:23 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=788783 An accounting adjustment that extinguishes a corporate debtor's receivable in favour of a related party can constitute a preferential transfer under Section 43 of the Insolvency and Bankruptcy Code, even without physical movement of funds. The tribunal treated the square-off and offsetting entries as a transfer because they reduced the debtor's asset pool and satisfied dues of entities under common control. It also found the transaction fell within the relevant look-back period for related parties. The plea that the adjustment was in the ordinary course of business failed, as the entry bypassed banking channels, lacked corporate authorisation, and was not a routine commercial transaction. Case-Laws IBC Wed, 25 Mar 2026 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=788783