# In the matter of Bezel Stockbroker Private Limited

> NCLT judgment dated 2023-08-02. Citation: TCN-2023-NCLT-02208. M/s Bezel Stockbrokers Private Limited filed an application under Section 10 of the Insolvency…

- **Court:** NCLT
- **Order date:** 2 Aug 2023
- **Citation:** TCN-2023-NCLT-02208
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/bezel-stockbroker-private-limited-df192e7f

## Summary

### Background

M/s Bezel Stockbrokers Private Limited filed an application under Section 10 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate the Corporate Insolvency Resolution Process (CIRP). The company, incorporated on 01.02.2013, is a stock broker registered with SEBI. It faced financial difficulties, including an inability to deposit the required margin for stock purchases, leading to SEBI forfeiting shares and creating liabilities towards shareholders/clients. The company also failed to return advance funds to clients, resulting in a total liability of Rs.4,27,63,436/-. Consequently, it was declared a defaulter and expelled from NSE membership.

## Facts

M/s Bezel Stockbrokers Private Limited, a company incorporated on 01.02.2013 and registered with SEBI as a stock broker, filed an application under Section 10 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP). The company faced financial difficulties, including an inability to deposit the 20% margin for stock purchases as per SEBI rules, leading to SEBI forfeiting shares and creating a liability of Rs.3,35,84,815/- towards shareholders/clients. Additionally, the company failed to return advance funds (Cash & Collateral) to its clients, creating a further liability of Rs.91,78,621/-. The total liability of the company towards its clients amounted to Rs.4,27,63,436/-. The company was declared a defaulter and

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## Issues and analysis

### Issue 1: Whether a Stock Broker Company is …

**Ratio:** Section 3(16) of the IBC 2016 defines 'financial service' to include various services

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**Reasoning:** The court reasoned that since the Corporate Applicant was carrying on the business as a

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**Interpretation:** The interpretation of 'financial service' and 'financial product' under the IBC

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**Application:** The court applied the definitions of 'financial service' and 'financial

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## Parties

- **Judges:** SH. ASHOK KUMAR…; SH. L. N.…
- **Respondents:** M/s Bezel…; Security Exchange…

## Timeline

- **2013-02-01 — Incorporation o…**: M/s Bezel Stockbrokers…
- **2019-06-01 — SEBI Regist…**: The Corporate Applicant has been registered with the Securities and Exchange Board of…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 10 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-10)

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