TaxTMI 
TaxTMI 
2021 (5) TMI 274
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....rest at the rate of 15% per annum amounting to Rs. 2,20,61,802.08 due as on 30.11.2018 totalling to sum of Rs. 9,80,00,802.08 (Rupees Nine Crore Eighty Lakh Eight Hundred and Two and Eight paise only). The date of default is 18.05.2017. 2. The averments made in the Application are as follows: (i) The Corporate Debtor approached the Financial Creditor seeking financial aid to further its business of generation of power through renewable sources of energy. The Financial Creditor, in its capacity as sole trustee of GVFL Venture Capital Fund, had entered into Investment-aim-Shareholders Agreement dated 07.09.2013 with the Corporate Debtor and its promoters on terms and conditions stated therein. (ii) By virtue of Clause 3.2 of the Agreement, the Financial Creditor granted its first tranche amount of Rs. 29,50,00,000/- to the Corporate Debtor and the same was acknowledged by the Corporate Debtor vide its letter dated September, 2013. In respect of debt granted, the Corporate Debtor issued Class-B Equity shares amounting to Rs. 50,00,000/- and Compulsorily Convertible Debentures (CCDs) worth Rs. 29,00,00,000/- as securities. In respect of clause 7.1.1 of the Investment Agreement, a ....
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....ble by the Corporate Debtor. (viii) By a letter dated 08.02.2018, the Corporate Debtor admitted their inability to make payments on account of their group companies turning Non-Performing Assets ("NPA") 3. On perusal of documents, it appears that the Respondent Company has changed its name from M/s. Ushdev Power Holding Private Limited to M/s. Ultravolt Power Private Limited and the same is effected before RoC also as reflected in the MCA Website. 4. The Respondent has filed its reply and also written submissions. The Respondent states that the alleged loan is not a 'financial debt'. The Applicant and Corporate Debtor had entered into an agreement "Investment-cum-Shareholders" Agreement dated 07.09.2013. Based on this agreement, the applicant infused funds to the respondent company to the tune of Rs. 29,50,00,000/- as first tranche amount. The Applicant had also subscribed to Rs. 5,00,000/- equity shares and Rs. 2,90,00,000/- Compulsorily Convertible Debentures (CCDs) of Rs. 10/- face value each in the first tranche of investment. Thereafter, there were disputes between the parties. After various rounds of discussions, the Applicant and the Corporate Debtor entered into....
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....ent case, the applicant has not invoked these provisions and prescribed manner for repayment and sought for a simple money claim. Further, the alleged 'debt' which arises out of the Settlement Agreement dated 06.09.2016 provides for resolution between the parties. The Respondent further states that any dispute that arises out of the Settlement Agreement between the parties can be resolved by way of arbitration. The respondent cites the judgement of the Hon'ble Supreme Court in Innoventive Industries Ltd. v. ICICI Bank Ltd. (2018) 1 SCC 407 ara para 28: ".... It is at the stage of Section 7(5), where the adjudicating authority is to be satisfied that a default has occurred, that the corporate debtor is entitled to point out that a default has not occurred in the sense that the '"debt" which may also include a disputed claim, is not due. A debt may not be due if it is not payable in law or in fact...." 7. In the arguments as well as in the oral submissions by both the parties who have agreed that the applicant herein has invoked arbitration and has filed a petition before the Hon'ble Gujarat High Court in R/IAAP-(PETN. UNDER ARBITRATION ACT) No. 60 of 2020 whic....
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....et and cash flow statements in relation to New Acquisitions and would form the basis of the acquisition strategy of the Company, until such time that the same is duly updated/revised with new projects or changes to existing projects with the consent of the Board. For the avoidance of doubt, it is expressly clarified that Annual Business Plan shall be reviewed by the Board on a quarterly basis. In the event, the Board is of the opinion that changes are required to the Annual Business Plan, based on such quarterly review of the Annual Business Plan, such changes shall require the affirmative consent of the Investor. Clause-11.1.2. Composition of the Board Clause 11.1.2.1 - On and from the First Closing Date, the Parties agree (unless otherwise agreed upon between the parties in writing) that the Board shall consist of 6 Directors and, subject to the provisions of Clause 11.1.2.3, Promoter No. 2 shall, be entitled to nominate 1 director on the Board, and Promoter No. 3 shall, be entitled to nominate 3 directors on the Board (collectively "Promoter Director(s)") Clause 11.1.2.2 - Until such time as the Investor holds 1% of the Share Capital, the Investor shall be entitled to nomi....
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....te Debtor Company has not utilized the proceeds of investment in accordance with the approved business plan does not carry any merit in as much as the Board of the investee company consists of two nominee directors and an observer nominated by the investor in order to oversee the entire corporate documentation pertaining to various meetings and activities including meetings of the Board of Directors in order to safeguard the interest of the Investor Company. Therefore, we take the considered view that Investor cannot be and need not be treated as a "Financial Creditor". 10. The issue before us is whether the alleged debt is a 'financial debt' and applicant as a "financial creditor" under the provisions of Section 5(8) of the IBC. Admittedly, the entire amount due and payable under the application arises out of Investment-cum-Shareholders Agreement dated 07.09.2013 which was subsequently and mutually agreed between the parties and a Settlement Agreement dated 06.09.2016 was arrived at. Further, the applicant admits that the entire amount as agreed between the parties has been repaid by the Corporate Debtor. This alleged amount mentioned in the application is only towards th....