# In the matter of Edelweiss Asset Reconstruction Company Ltd. vs. Anuj Jain, RP of Ballarpur Industries Ltd. & Ors.

> NCLAT judgment dated 2023-07-04. Citation: TCN-2023-NCLAT-00420. The case involves two appeals challenging orders passed by the Adjudicating Authority…

- **Court:** NCLAT
- **Order date:** 4 Jul 2023
- **Citation:** TCN-2023-NCLAT-00420
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/edelweiss-asset-reconstruction-company-ltd-vs-anuj-jain-rp-of-ballarpur-industri-a524450d

## Summary

### Background

The case involves two appeals challenging orders passed by the Adjudicating Authority (National Company Law Tribunal), Mumbai Bench, Court-III, dated 31.03.2023. The first order rejected I.A. No. 1311/2022 filed by the Appellant in C.P No. 2915/IBC/MB/2019. The second order approved I.A. No. 1143/2022 filed by the Resolution Professional for approval of the Resolution Plan submitted by Respondent No.3. The Appellant, Edelweiss Asset Reconstruction Company Ltd., claimed to have a security interest in the immovable asset of the Corporate Debtor, Ballarpur Industries Limited, specifically land in Choudwar, Orissa. The Appellant's claim as a Financial Creditor was rejected, and it was categorized as an 'Other Creditor' with a notional value of Re. 1. The Appellant argued

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## Facts

Yes Bank Ltd. granted term loans to BILT Graphic Paper Products Ltd. (BGPPL), the Principal Borrower. Ballarpur Industries Limited (Corporate Debtor) executed a Corporate Guarantee and created a mortgage on its immovable property in Choudwar, Orissa, to secure the loans. On 30.09.2016, Yes Bank assigned its debt to Edelweiss Asset Reconstruction Company Ltd. (EARCL), the Appellant. Finquest Financial Solutions Pvt. Ltd. initiated CIRP against the Corporate Debtor under Section 7 of IBC, and CIRP was initiated on 17.01.2020. The Appellant filed its claim in Form C as a Secured Financial Creditor for INR 133,24,05,045/- on 05.02.2020. The Resolution Professional rejected the Appellant's claim as a Financial Creditor on 19.10.2020, categorizing it as an 'Other Creditor'

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## Issues and analysis

### Issue 1: Whether the security interest of the Appellant, categorized as an 'Other Creditor' with a notional …

**Ratio:** Regulation 37 of CIRP Regulations, 2016 allows the resolution plan to provide for

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**Reasoning:** The court reasoned that since the Appellant's security interest was part of the CIRP

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**Interpretation:** This means that the I&B Code and CIRP Regulations allow for the

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**Application:** In this case, the Appellant's security interest was part of the CIRP process,

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## Parties

- **Judges:** Ashok Bh…; Naresh Sa…
- **Appellants:** Edelweiss Asset…
- **Respondents:** Ballarpur…; Anuj Jain,…
- **Advocates:** Arun Kath…; Krishnendu…; +10 more

## Timeline

- **2015-09-01 — Term Loan G…**: Yes Bank Ltd. granted a term loan of INR 150 Crores to BILT Graphic Paper Products Ltd.…
- **2016-05-04 — Second Term Loa…**: A second term loan of INR 250…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

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