This case involves an appeal against the Adjudicating Authority's order to admit an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC). The Adjudicating Authority initiated Corporate Insolvency Resolution Process (CIRP) against DMC Infrastructure Pvt. Ltd. based on a guarantee agreement for loan facilities sanctioned to Roshni Jewellers Pvt. Ltd. and J.B. Gold Pvt. Ltd. The appellant, Rajnish Gupta, challenged the order, arguing that the respondent, Union Bank of India, is an indirect secured creditor and not a financial creditor, and that the service of notice was not properly effected. The appellant also contended that the respondent had initiated CIRP against the principal borrowers, which were later withdrawn.
On 25.06.2013, Union Bank of India (the Respondent/Lender) sanctioned overdraft facilities of Rs. 9 Crores each to Roshni Jewellers Pvt. Ltd. and J.B. Gold Pvt. Ltd. DMC Infrastructure Pvt. Ltd. (the Appellant) executed a guarantee agreement dated 27.06.2013 to secure these facilities. The Respondent initiated CIRP against Roshni Jewellers and J.B. Gold, but later withdrew these proceedings. The Respondent then initiated CIRP against the Appellant based on the guarantee agreement. The Appellant argued that the Respondent was an indirect secured creditor, not a financial creditor, and that the service of notice was improper. The Adjudicating Authority admitted the application, leading to the present appeal. The Appellant had created a security interest on its asset,
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Union Bank of India sanctioned overdraft…
DMC Infrastructure Pvt.…
This case involves an appeal against the Adjudicating Authority's order to admit an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC). The Adjudicating Authority initiated Corporate Insolvency Resolution Process (CIRP) against DMC Infrastructure Pvt. Ltd. based on a guarantee agreement for loan facilities sanctioned to Roshni Jewellers Pvt. Ltd. and J.B. Gold Pvt. Ltd. The appellant, Rajnish Gupta, challenged the order, arguing that the respondent, Union Bank of India, is an indirect secured creditor and not a financial creditor, and that the service of notice was not properly effected. The appellant also contended that the respondent had initiated CIRP against the principal borrowers, which were later withdrawn.
On 25.06.2013, Union Bank of India (the Respondent/Lender) sanctioned overdraft facilities of Rs. 9 Crores each to Roshni Jewellers Pvt. Ltd. and J.B. Gold Pvt. Ltd. DMC Infrastructure Pvt. Ltd. (the Appellant) executed a guarantee agreement dated 27.06.2013 to secure these facilities. The Respondent initiated CIRP against Roshni Jewellers and J.B. Gold, but later withdrew these proceedings. The Respondent then initiated CIRP against the Appellant based on the guarantee agreement. The Appellant argued that the Respondent was an indirect secured creditor, not a financial creditor, and that the service of notice was improper. The Adjudicating Authority admitted the application, leading to the present appeal. The Appellant had created a security interest on its asset,
…Union Bank of India sanctioned overdraft…
DMC Infrastructure Pvt.…