# In the matter of Nobility Estates Pvt. Ltd.

> NCLT judgment dated 2023-11-24. Citation: TCN-2023-NCLT-00573. ASK Trusteeship Services Private Limited, acting as the Applicant/Financial Creditor, filed an…

- **Court:** NCLT
- **Order date:** 24 Nov 2023
- **Citation:** TCN-2023-NCLT-00573
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/nobility-estates-pvt-ltd-523972a9

## Summary

### Background

ASK Trusteeship Services Private Limited, acting as the Applicant/Financial Creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against M/s Nobility Estates Pvt. Ltd, the Respondent/Corporate Debtor. The application was filed on 25.05.2023, seeking a moratorium and the appointment of an Interim Resolution Professional (IRP). The Corporate Debtor was incorporated on 02.01.2014 and is involved in real estate activities. The Applicant claimed default based on a Debenture Subscription Agreement (DSA) where the Respondent failed to redeem Optionally Convertible Debentures (OCDs) by the revised redemption date of July 31, 2021.

## Facts

ASK Trusteeship Services Private Limited (Applicant/Financial Creditor) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against M/s Nobility Estates Pvt. Ltd (Respondent/Corporate Debtor). The Corporate Debtor was incorporated on 02.01.2014 and is involved in real estate activities. The Applicant and Respondent entered into a Debenture Subscription Agreement (DSA) dated 10.07.2015, where the Applicant subscribed to debentures issued by the Respondent. The Applicant disbursed amounts as per the schedule: Rs. 40,00,00,000/- on 07.10.2015, Rs. 25,00,00,000/- on 03.11.2015, and Rs. 60,00,00,000/- on 22.03.2016. The Applicant was allotted 1,250 unlisted optionally convertible

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## Issues and analysis

### Issue 1: Whether an investment made in the …

**Ratio:** Section 5(8) of the IBC, 2016 defines 'financial debt' as a debt along with interest, if

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**Reasoning:** The court reasoned that the disbursement of money through investment in Debentures of the

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**Interpretation:** The court interpreted Section 5(8) of the IBC, 2016 to include amounts raised

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**Application:** In this case, the Applicant disbursed money to the Corporate Debtor through

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## Parties

- **Judges:** Ramalingam…; SH. L. N.…
- **Appellants:** ASK Trusteeship…
- **Respondents:** M/s NOBILITY…

## Timeline

- **2014-01-02 — Incorporation of…**: M/s Nobility Estates Pvt.…
- **2015-07-10 — Debenture Subscription…**: Applicant and Respondent executed a…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

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