# In the matter of Transnational Growth Fund Limited

> NCLT judgment dated 2023-08-29. Citation: TCN-2023-NCLT-01873. 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-01873
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/transnational-growth-fund-limited-94b8a64a

## 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 on 2022-05-12, and an amount of Rs. 1,37,40,000 was disbursed. The corporate debtor failed to make payments as per the loan agreement, leading to a total debt of Rs. 1,46,70,321 as of 2022-12-31. The Corporate Debtor is registered as Non Banking Financial Company under NBFC-NDSI category.

## Facts

Utsav Securities Private Limited ('applicant') filed a Company 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'). A Loan Agreement was entered between the Applicant and Corporate Debtor on 2022-05-12. The Applicant disbursed Rs.1,37,40,000/- on different dates as interest bearing loan at an interest of 12% per annum repayable after a period of six months from the date of Loan Agreement. The execution of Loan agreement dated 2022-05-12 was duly approved and supported by the Corporate Debtor's Board

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor falls under the definition of 'Financial Service Provider' as per …

**Ratio:** Section 3(17) of the IBC, 2016, defines 'financial service provider' as a person engaged

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

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**Interpretation:** The definition of 'financial service provider' is interpreted broadly to

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**Application:** Since the Corporate Debtor is a registered NBFC regulated by the RBI, it is

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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…
- **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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