# In the matter of Transnational Growth Fund Limited

> NCLT judgment dated 2023-08-29. Citation: TCN-2023-NCLT-01877. Utsav Securities Private Limited filed an application under Section 7 of the Insolvency and…

- **Court:** NCLT
- **Order date:** 29 Aug 2023
- **Citation:** TCN-2023-NCLT-01877
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/transnational-growth-fund-limited-73ad5b91

## Summary

### Background

Utsav Securities Private Limited filed an application under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Transnational Growth Fund Limited, alleging default in payment of debt. The applicant claimed that a loan agreement was entered into between them on 2022-05-12, and they disbursed Rs. 1,37,40,000/- as an interest-bearing loan. The corporate debtor failed to make payments as per the loan agreement, resulting in a total debt of Rs. 1,46,70,321/- as of 2022-12-31. The Corporate Debtor is registered as a Non-Banking Financial Company.

## Facts

Utsav Securities Private Limited ('applicant') filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 ('Code') read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, for initiating the Corporate Insolvency Resolution Process (‘CIRP') against Transnational Growth Fund Limited ('Respondent/Corporate Debtor'). The applicant and corporate debtor entered into a Loan Agreement on 2022-05-12. The applicant disbursed Rs. 1,37,40,000/- on different dates as an interest-bearing loan at 12% per annum. The execution of the Loan agreement was approved by the Corporate Debtor's Board Resolution dated 2022-05-02. The Corporate Debtor failed to make payments, resulting in a total debt of INR. 1,46,70,321 as of

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor, being a registered Non-Banking Financial Company (NBFC), can be …

**Ratio:** Section 3(7) of the IBC, 2016, defines a 'corporate person' and excludes from its

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**Reasoning:** The Adjudicating Authority observed that the Corporate Debtor is a registered Non-Banking

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**Interpretation:** The IBC distinguishes between 'corporate persons' and 'financial service

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**Application:** In this case, the Corporate Debtor is a registered NBFC under the NBFC-NDSI

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## Parties

- **Judges:** P.S.N. P…; BINOD KUMAR…
- **Appellants:** Utsav Securities…
- **Respondents:** Transnational…; Transnational…

## Timeline

- **2022-05-02 — Board Reso…**: Corporate Debtor's Board Resolution…
- **2022-05-12 — Loan Agre…**: Loan Agreement entered between the…

## 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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