Case Law Details
Hiren Meghji Bharani Vs Shankheshwar Properties Pvt. Ltd. (NCLAT Delhi)
Introduction: The appeal of Hiren Meghji Bharani against the order for Corporate Insolvency Resolution Process (CIRP) raises crucial questions regarding the admissibility of an unstamped document titled “confirmation and undertaking.” This article delves into the NCLAT Delhi judgment on the matter, exploring its implications and analyzing the arguments presented by both parties.
Detailed Analysis: The core contention revolves around whether the Adjudicating Authority erroneously relied on the unstamped document in deciding on CIRP. The appellant challenges the judgment, citing the Essar Steel India Limited case and asserting that the document’s unstamped nature makes it inadmissible. However, the article dissects the precedent set by the Satra Properties case and emphasizes that the document’s admissibility depends on the presence of other materials proving the debt and default.
The analysis further explores the appellant’s claim that the financial creditor made an investment rather than providing a loan. Contradictions arise as the corporate debtor’s balance sheet and admission of servicing interest align with the financial creditor’s loan classification. The NCLAT judgment highlights the Adjudicating Authority’s reliance on admitted documents, including audited financial statements and demand notices, to establish the debt and default, rendering the unstamped document secondary.
Conclusion: In conclusion, the NCLAT upholds the Adjudicating Authority’s decision, emphasizing that the non-stamping of the document does not render the CIRP application non-maintainable. The article underscores the significance of other admissible materials in proving the debt and default, irrespective of the unstamped document’s status. This ruling sets a precedent for cases where the admissibility of documents is challenged based on stamping issues in insolvency proceedings.
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