# In the matter of Phoenix ARC Pvt. Ltd. Vs. Ketulbhai Ramubhai Patel Civil Appeal No. 5146 of 2019

> SC judgment dated 2021-02-03. Citation: TCN-2021-SC-00077. This appeal, filed under Section 62 of the Insolvency and Bankruptcy Code, 2016, challenges the…

- **Court:** SC
- **Order date:** 3 Feb 2021
- **Citation:** TCN-2021-SC-00077
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/supreme-court-of-india/phoenix-arc-pvt-ltd-vs-ketulbhai-ramubhai-patel-civil-appeal-no-5146-of-2019-13ba5dda

## Summary

### Background

This appeal, filed under Section 62 of the Insolvency and Bankruptcy Code, 2016, challenges the National Company Law Appellate Tribunal's (NCLAT) judgment dated 09.04.2019, which dismissed the appellant's Company Appeal. The Company Appeal was filed against the National Company Law Tribunal (NCLT), Mumbai Bench's order dated 22.02.2019, which rejected the appellant's Miscellaneous Application. The NCLT held that the appellant is not a financial creditor of the corporate debtor, Doshion Veolia Water Solutions Private Limited. The appellant claims to be a financial creditor based on a pledge agreement where the corporate debtor pledged shares of Gondwana Engineers Limited (GEL) as security for a financial facility advanced by L&T Infrastructure Finance Company

…

## Facts

L & T Infrastructure Finance Company Limited advanced a financial facility to Doshion Limited under a Facility Agreement dated 12.05.2011. The agreement stipulated a repayment of Rs.40 crores in 72 structured monthly installments. The Board of Directors of Doshion Veolia Water Solutions Private Limited (corporate debtor) passed a resolution on 26.07.2011 to provide a Non-Disposal Undertaking in favor of L & T Infrastructure Finance Company Limited. On 10.01.2012, a Pledge Agreement was executed between Doshion Veolia Water Solutions Private Limited and L&T Infrastructure Finance Company Limited, pledging 40,160 shares of Gondwana Engineers Limited (GEL) as security. L&T Infrastructure assigned its rights to Phoenix ARC Pvt. Ltd. on 30.12.2013. Doshion

…

## Issues and analysis

### Issue 1: Whether the corporate debtor owed any financial debt to the appellant so as to treat the appellant …

**Ratio:** A 'financial debt' under Section 5(8) of the IBC means a debt disbursed against the

…

**Reasoning:** The court reasoned that the corporate debtor (Doshion Veolia Water Solutions Private

…

**Interpretation:** The court interpreted Section 5(8) of the IBC to require a direct financial

…

**Application:** In this case, the corporate debtor only provided a pledge of shares as

…

## Parties

- **Judges:** Ashok Bh…; R. Subhash…; +1 more
- **Appellants:** Phoenix ARC Pvt.…
- **Respondents:** Doshion Veolia…; Sh. Ketulbhai…
- **Other parties:** Affir…

## Timeline

- **2011-05-12 — Facility Ag…**: L & T Infrastructure Finance Company Limited and Doshion Limited executed a Facility…
- **2011-07-26 — Resolution by Corporate…**: Board of Directors of Doshion Veolia Water Solutions Private Limited passed a resolution…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 62 — Appeal to Supreme Court](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-62)

---

This is a preview. The full structured summary, issues, precedents and source judgment are available on CaseEase - Legal Intelligence Simplified: https://caseease.in/cases/ibc/supreme-court-of-india/phoenix-arc-pvt-ltd-vs-ketulbhai-ramubhai-patel-civil-appeal-no-5146-of-2019-13ba5dda