# In the matter of Cox & Kings Ltd. IA 513-2020 in CP(IB)-2640-2019

> NCLT judgment dated 2021-12-16. Citation: TCN-2021-NCLT-00148. IA 513/2020 was filed in CP(IB)-2640/2019 by IFFCO Tokio General Insurance Co. Ltd seeking to…

- **Court:** NCLT
- **Order date:** 16 Dec 2021
- **Citation:** TCN-2021-NCLT-00148
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/cox-kings-ltd-ia-513-2020-in-cpib-2640-2019-09bb1b61

## Summary

### Background

IA 513/2020 was filed in CP(IB)-2640/2019 by IFFCO Tokio General Insurance Co. Ltd seeking to treat its claim of Rs. 83 crore as an 'Asset in Trust' under the IB Code, rather than as a claim of an Operational or Financial Creditor. IFFCO Tokio had issued an insurance policy to IATA, which represents its members. One of these members was the Corporate Debtor, Cox & Kings Ltd. Due to defaults by Cox & Kings, IATA submitted an insurance claim to IFFCO Tokio, which paid IATA Rs. 83 crore on November 1, 2019. On the same day, IATA subrogated IFFCO Tokio, empowering it to recover the amount.

## Facts

IFFCO Tokio General Insurance Co. Ltd. issued an insurance policy to the International Air Transport Association (IATA) on behalf of its members. Cox & Kings Ltd., the Corporate Debtor, was an agent of IATA. Cox & Kings defaulted, leading IATA to submit an insurance claim to IFFCO Tokio for Rs. 83 crore. IFFCO Tokio paid IATA on November 1, 2019, and IATA subrogated IFFCO Tokio's right to recover the amount. IFFCO Tokio filed a claim to be treated as an 'Asset in Trust' under the Insolvency and Bankruptcy Code (IBC), relying on Clause 7.2 of the agreement between IATA and Cox & Kings, which stated that monies collected by the agent are held in trust for the carrier. IFFCO Tokio had already filed its claim as an Operational Creditor. Clause 7.4 of the

…

## Issues and analysis

### Issue 1: Whether the claim of IFFCO Tokio General Insurance Co. Ltd. can be classified as an 'Asset in …

**Ratio:** The mere stipulation of a trust clause in an agreement is not sufficient to classify an

…

**Reasoning:** The NCLT reasoned that if the parties intended the amount to be held in trust, they would

…

**Interpretation:** Section 18(f) of the IBC requires that assets held in trust must be genuinely

…

**Application:** In this case, IFFCO Tokio relied on Clause 7.2 of the agreement, which stated

…

## Parties

- **Judges:** H.V. Subb…; Chandra Bha…
- **Appellants:** M/s IFFCO Tokio…
- **Respondents:** M/s Cox & Kings…

## Timeline

- **2019-11-01 — Payment t…**: IFFCO Tokio made payment to…
- **2019-11-01 — Subrogat…**: IATA subrogated and empowered…

## 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)

---

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/nclt-chandigarh/cox-kings-ltd-ia-513-2020-in-cpib-2640-2019-09bb1b61