TaxTMI 
TaxTMI 
2026 (7) TMI 843
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....mited) and because of occurrence of default and non-remittance of debt despite demand notice issued for same. Further, it is noted that the Appellant is an Asset Reconstruction Company, which happens to be registered under the SARFAESI Act and it had got the debt assigned to it by the original financial credit South Indian Bank in consonance to the statutory provisions under Section 3 and 5 of the SARFAESI Act, by execution of a deed of assignment in its favour. 2. When the proceedings were taken up before the Ld. Tribunal, the Corporate Debtor had opposed the proceedings on the ground of limitation and further on the ground that, the signatures appearing on the loan document were forged, and since the proceedings have been initiated under PMLA, the petition under IBC was not maintainable. 3. During the course of arguments, though without any pleading, a plea was taken by Respondent, while opposing the application initiated under Section 7 of the Code is that, the assignment deed in favour of the Appellant is not admissible in evidence because it has not been sufficiently "stamped and registered", as per law, and therefore it cannot be taken into consideration and besides tha....
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....ped based on provision of said Section 25 because the said section has no application in the case of the assignment of debt, and it relates to the transfer of property in consideration of a debt. Section 25 of Kerala Stamp Act, 1959 reads as under: - "25. How transfer in consideration of debt, or subject to future payment etc, to be charged. Where any property is transferred to any person in consideration, wholly or in part, of any debt due to him or subject either certainly or contingently to the payment or transfer of any money or stock, whether being or constituting a charge or encumbrance upon the property or not such debt, money, or stock is to be deemed the whole or part, as the case may be, of the consideration in respect whereof the transfer is chargeable with ad valorem duty: Provided that nothing in this section shall apply to any such certificate of sale as in mentioned in Article 16 of the Schedule. Explanation: - In the case of a sale of property subject to a mortgage or other encumbrance any unpaid mortgage money or money charged, together with the interest, if any, due on the same, shall be deemed to be part of the consideration fo....
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....ings came up for consideration before the Ld. Tribunal, by way of CP (IBC)/51/KOB/2022, the Ld. Tribunal, while briefly narrating the facts of the application under Section 7 of the Code, while observing thereof that the Financial Creditor had various credit facilities with M/s. Kerala Chambers of Commerce and Industry, and they were engaged in the construction of buildings, construction of commercial establishments, which included the project in question, that is, the Kerala Trade Centre, being raised on the land that belonged to the Corporate Debtor. 12. The Corporate Debtor also stood as a Guarantor of the credit facilities, to the Principal Borrower. Since the construction process being agreed to be carried under a joint venture, between the Principal Borrower and the Corporate Debtor, the necessary documents were executed for each of the credit facilities. However, M/s. Kerala Chambers of Commerce and Industry, the Principal Borrower, had already availed other credit facilities with the bank prior to the said sanction. Be that as it may. 13. An amount of Rs 1.10 Crores was sanctioned on 15.09.2010, as a fully secured loan, and a credit facility agreement was executed on ....
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....ons of Kerala Stamp Act will be applicable and the exemption provided under Section 8F of the Indian Stamp Act, 1899 will not be applicable to the said deed executed on 17.03.2017 within the State of Kerala, and in the absence of there being any exemption on the payment of the stamp duty payable under the Kerala Stamp Act, the deed of assignment dated 16.09.2010 cannot be considered to form the basis of judicial proceedings, under Section 7 of the Code being insufficiently stamped. 19. The Ld. Tribunal took the view that, the provisions contained under Section 8F of the Indian Stamp Act, even exempting payment of duty on the assignment of a right or an interest in financial assets, will not be applicable in this case as Kerala Stamp Act, 1959 has repealed Indian Stamp Act, 1899. Section 8F is extracted hereunder: - "8F. Agreement or document for transfer or assignment of rights or interest in financial assets not liable to stamp-duty.-- Notwithstanding anything contained in this Act or any other law for the time being in force, any agreement or other document for transfer or assignment of rights or interest in financial assets of banks or financial institutions under se....
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....g not been placed on record before the Ld. Tribunal, the Ld. Tribunal took the view that, the cause title of the Phoenix ARC Private Limited Company as referred to as trustee of Phoenix Trust, as depicted in the petition filed by the Phoenix ARC Private Limited Company, cannot be conclusively considered under the Trust Deed that was filed on record. 24. Since a trust being a non-living juristic person, it could have only functioned through a person who holds an authority on its behalf to initiate proceedings. In the case at hand, the Ld. Tribunal took the view that since a non-living juristic person has filed a petition through the Petitioner, who was not holding an authority under the Trust Deed, and hence in the absence of the Trust Deed having been produced on record, which is vital, the proceedings initiated under Section 7 of the Code, were held to be not maintainable. 25. When this company appeal was preferred, as against the impugned order, as passed in CP (IBC)/51/KoB/2022 the Appellant herein, by virtue of IA No. 295 of 2023 and IA No. 870 of 2024, had sought to place on record the original Trust Deed dated 06.02.2017, as well as the order dated 07.12.2023 that was p....
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....uired or made, and not from the time of its registration." 29. In the light of the language used under Section 47 of Registration Act, as extracted above, the deed of assignment, even though it was not stamped as per the provisions of the Kerala Stamp Act, to be read in consonance with the provisions of the Registration Act, will operate from the date of its execution, i.e., 17.03.2017 even though it was insufficiently stamped at that point of time and it was registered only on 30.03.2024 in compliance to the directions issued by the orders of the Hon'ble High Court. Further, since the registered Assignment Deed has been placed on record, that itself would sustain the proceedings under Section 7 of the I & B Code, which otherwise now deserves to be decided on its own merits. 30. Further, whether the question of whether the Appellant had the authority to initiate CIRP due to non-presentation of the Trust Deed also stands satisfied, since the said document too has already been supplied, by the Appellant with IA No. 295 of 2023, which had been directed by this Appellate Tribunal to be considered at the stage of final hearing by an order passed by this Appellate Tribunal on 11.03....