# In the matter of Gaurav Agrawal, director Albus India Ltd. Vs. TUF Metallurgical Pvt. Ltd. & Anr. CA(AT)(Insolvency) 212-2019

> NCLAT judgment dated 2019-07-25. Citation: TCN-2019-NCLAT-00418. The case involves an appeal regarding whether an amount advanced for the procurement of 'Low…

- **Court:** NCLAT
- **Order date:** 25 Jul 2019
- **Citation:** TCN-2019-NCLAT-00418
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/gaurav-agrawal-director-albus-india-ltd-vs-tuf-metallurgical-pvt-ltd-anr-ca-6804e0f1

## Summary

### Background

The case involves an appeal regarding whether an amount advanced for the procurement of 'Low Carbon Ferro Chrome' constitutes a 'Financial Debt' under Section 5(8) of the Insolvency & Bankruptcy Code, 2016. The appellant contends that the amount was disbursed towards the purchase of goods, while the respondent argues that it represents a loan with a 2% monthly interest rate, thus falling under the definition of 'financial debt'.

## Facts

Gaurav Agrawal, Director of M/s Albus India Ltd., filed an appeal against M/s. TUF Metallurgical Pvt. Ltd. & Anr. The dispute concerns an agreement dated April 4, 2017, where the respondent had the right to procure 'Low Carbon Ferro Chrome' from the 'Corporate Debtor'. The appellant argues that the amount advanced for this procurement does not constitute a 'Financial Debt' under Section 5(8) of the Insolvency & Bankruptcy Code, 2016, because it was disbursed for the purchase of goods. The respondent contends that the amount was disbursed as a loan with a 2% monthly interest rate, thus qualifying as a 'financial debt' and giving them a first charge over the 'Low Carbon Ferro Chrome'. The relevance of these facts lies in determining whether the respondent can be

…

## Issues and analysis

### Issue 1: Whether the amount advanced for the procurement of 'Low Carbon Ferro Chrome' constitutes a …

**Ratio:** The legal principle is based on the definition of 'financial debt' under Section 5(8) of

…

**Reasoning:** The court's reasoning will depend on the interpretation of the agreement and the evidence

…

**Interpretation:** The interpretation of Section 5(8) is crucial. The court must determine whether

…

**Application:** Applying the ratio to the facts, if the court finds that the amount was indeed

…

## Parties

- **Judges:** S.J. Mukhop…; A.I.S. C…; +1 more
- **Appellants:** Gaurav Ag…
- **Respondents:** M/s. TUF Metallurg…

## Timeline

- **2017-04-04 — Agreement…**: Agreement dated 4th April, 2017, Respondent had right to procurement of ‘Low Carbon Ferro…
- **2019-07-25 — Order Da…**: Hearing of the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 5(8) — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-5)

---

This is a preview. The full structured summary, issues, precedents and source judgment are available on CaseEase - Legal Intelligence Simplified: https://caseease.in/cases/ibc/nclat-new-delhi/gaurav-agrawal-director-albus-india-ltd-vs-tuf-metallurgical-pvt-ltd-anr-ca-6804e0f1