# In the matter of Autocop (India) Pvt. Ltd.

> NCLT judgment dated 19 Dec 2023. Citation: TCN-2023-NCLT-00166. Bizloan Private Limited, a Non-Banking Financial Company and financial creditor of…

- **Court:** NCLT
- **Order date:** 19 Dec 2023
- **Citation:** TCN-2023-NCLT-00166
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/autocop-india-pvt-ltd-f53e345a

## Summary

### Background

Bizloan Private Limited, a Non-Banking Financial Company and financial creditor of Autocop(India) Private Limited (Corporate Debtor), filed an application under Section 60(5)(b) of the Insolvency and Bankruptcy Code, 2016. The application sought directions for the Liquidator to classify Bizloan as a "Secured Financial Creditor" instead of an "unsecured Financial Creditor" during the liquidation process of the Corporate Debtor. The Liquidator, Mr. Amit Chandrashekhar Poddar, had initially classified Bizloan's debt as unsecured because the charge on the Corporate Debtor's assets was not registered with the Registrar of Companies (RoC) under Section 77 of the Companies Act, 2013.

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## Facts

Bizloan Private Limited, a Non-Banking Financial Company, extended credit facilities to Autocop(India) Private Limited, the Corporate Debtor. These facilities were in the form of Sales Bill Discounting and Purchase Bill Discounting, with a sanctioned amount of Rs. 50 lakhs for each. The Corporate Debtor executed loan application forms and two sanction letters dated February 27, 2019, and March 28, 2019, followed by corresponding Loan Agreements/Facility Agreements. These were short-term loans with bullet repayment schedules.

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## Issues and analysis

### Issue 1: Whether Bizloan Private Limited, despite registering its charge with CERSAI, can be classified as a…

**Ratio:** A charge created by a company must be duly registered with the Registrar of Companies…

**Reasoning:** The Tribunal reasoned that **Section 77(3) of the Companies Act, 2013**, as amended on…

**Interpretation:** The court interpreted **Section 77(3) of the Companies Act, 2013**, to be a…

**Application:** Applying this interpretation to the facts, the Tribunal found that Bizloan…

## Parties

- **Judges:** Shri. Kuldip…; Shri. Anil Raj…
- **Advocates:** For the Applicant:…; For the Respondent…

## Timeline

- **February 27, 2019 — Sanction Lette…**: Corporate Debtor executed loan application forms and received a sanction letter for…
- **March 28, 2019 — Sanction Lette…**: Corporate Debtor executed loan application forms and received a second sanction letter…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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