# In the matter of Perpetual Capital and Servicing Private Limited

> NCLT judgment dated 2024-03-13. Citation: TCN-2024-NCLT-02059. This case involves an application (IA No. 5197/2023) filed by Vijay P. Lulla, the Resolution…

- **Court:** NCLT
- **Order date:** 13 Mar 2024
- **Citation:** TCN-2024-NCLT-02059
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/perpetual-capital-and-servicing-private-limited-f60db915

## Summary

### Background

This case involves an application (IA No. 5197/2023) filed by Vijay P. Lulla, the Resolution Professional (RP) of Perpetual Capital & Servicing Private Limited, the Corporate Debtor, under Section 66 of the Insolvency and Bankruptcy Code, 2016, read with Regulation 35A of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process For Corporate Persons) Regulations, 2016. The RP sought declarations and directions related to alleged fraudulent transactions undertaken by the respondents, including fraudulent changes in shareholding, siphoning off funds through subsidiaries, and misrepresentation of net worth to the financial creditor. The Corporate Insolvency Resolution Process (CIRP) was initiated on 12.08.2022.

## Facts

The Corporate Insolvency Resolution Process (CIRP) of Perpetual Capital & Servicing Private Limited was initiated on 12.08.2022. Vijay P. Lulla was appointed as the Resolution Professional (RP). The RP filed an application (IA No. 5197/2023) under Section 66 of the Insolvency and Bankruptcy Code, 2016, alleging fraudulent transactions. The RP contended that the respondents, including the directors, had been carrying out the business of the Corporate Debtor with an intent to defraud creditors. The alleged fraudulent transactions included a fraudulent change in shareholding, where shares pledged with the Financial Creditor were transferred without obtaining the creditor's permission. Religare Finvest Ltd., the Financial Creditor, had advanced a loan of Rs. 228 Crores

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## Issues and analysis

### Issue 1: Whether the transfer of shares of the Corporate Debtor, which were pledged as additional security …

**Ratio:** Section 66 of the Insolvency and Bankruptcy Code deals with fraudulent transactions. To

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**Reasoning:** The Tribunal noted that the shares were pledged with the Financial Creditor as additional

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**Interpretation:** The interpretation of Section 66 requires establishing that the transaction was

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**Application:** In this case, the Tribunal found that the transfer of shares did not cause any

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## Parties

- **Judges:** SH. Justice…; Prabhat…
- **Appellants:** Vijay P.…
- **Respondents:** Perpetual Capital…; Sumitendr…

## Timeline

- **2022-08-12 — CIRP Init…**: The Tribunal passed an Order initiating the Corporate Insolvency Resolution Process…
- **2022-11-07 — Appointment…**: Mr. Vijay P. Lulla was appointed as the Interim Resolution Professional (IRP) by the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 66 — Fraudulent trading or wrongful trading](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-66)

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