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Section 7 IBC Application Valid for Independent Overdrafts, Not Just Consortium Lending; High Court Order Challenged.
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....Maintainability of application u/s 7 of IBC - Assignment of Debt - The Application under Section 7 of IBC filed is not confined to debt as arising in the arrangement due to Consortium Lending which was a term loan, but was also towards independent overdraft facility and amounts due in that context. As such, even if one was to stretch the Order of High Court dated 04.12.2015 to say that it affects SIB, still the South Indian Bank was competent to maintain Section 7 Application on the basis of overdraft facility which was provided outside the Consortium. Thus, the Order passed by the Adjudicating Authority is not at all justified and deserves to be set aside. - AT....