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TMI Blog2021 (10) TMI 116X X X X Extracts X X X X X X X X Extracts X X X X ..... Moreover, Section 5(8) defines financial debt to mean a debt along with interest which is disbursed against the consideration for the time value of money, where money should necessarily be borrowed against the condition of time value of money. Under Section 5(7), financial creditor is a person to whom financial debt is owed or to whom such debt has been legally assigned or transferred to - The Appellant has nowhere been able to show any document that there was a financial contract to borrow by the Corporate Debtor by the Respondent Corporate Debtor, in which refund of principal amount alongwith interest was included explicitly. We are, therefore, not persuaded by the contention of the Appellant that there was a time value of mone ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt has claimed that the Corporate Debtor High Time Marketing Private Limited (Respondent in the appeal) approached the Appellant and received ₹ 40 lakhs on 27.10.2010 from the Appellant for issuing shares to him. The share application money was paid in an Account No. 5582000100022401 in Karnataka Bank Limited, Karol Bagh, Delhi. Since no shares could be allotted to the Appellant, the Respondent refunded the principal amount of ₹ 40 lakhs on 9.2.2018 but no interest was paid on the principal amount as is required under Rule 17 of the Companies (Acceptance of Deposit)Rules, 2014. The Appellant has claimed that the interest payable by the Respondent is ₹ 85,35,000 and the default in payment of this alleged financial debt occu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e tax return copies were sent to the Corporate Debtor by the Appellant through email dated July 22, 2019 (attached at page 41 of the Appeal Paperbook) and the balance sheet of the Corporate Debtor for FY 2017-18 to show that his claim is due and payable (page 111 of the Appeal Paperbook). 7. The Impugned Order holds that the amount deposited by the Appellant is not covered in the definition of financial debt as provided in the IBC as there was no no time value of money attached with the deposit. The Impugned Order also holds that no financial contract has been produced by the Appellant in compliance of the provisions of the IBC or the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, either in the original ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial debt is owed and includes a person to whom such debt has been legally assigned or transferred to. 5(8) financial debt means a debt along with interest, if any, which is disbursed against consideration for the time value of money and includes (a money borrowed against the payment of interest; (b) any amount raise d by acceptance under any acceptance credit facility or its de-materialized equivalent; (c) any amount raised pursuant to any note purchase facility or the issue of bonds, notes, debentures, loan stock or any similar instrument; (d) the amount of any liability in respect of any lease or hire purchase contract which is deemed as a finance or capital lease under the Indian Accounting Standards or s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... due from any person and includes a financial debt and operational debt. 10. It is clear from definition given in Section 3(11) that debt is a much bigger set of financial liabilities, whereas financial debt is only a subset of the overall set of debt. Moreover, Section 5(8) defines financial debt to mean a debt along with interest which is disbursed against the consideration for the time value of money, where money should necessarily be borrowed against the condition of time value of money. Under Section 5(7), financial creditor is a person to whom financial debt is owed or to whom such debt has been legally assigned or transferred to. 11. The Appellant has nowhere been able to show any document that there was a financial c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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