No written loan agreement required under IBC to prove financial debt by NBFC; oral loans evidenced by acknowledgments, bank records suffice; fresh Section 7 petition maintainable post-settlement breach despite prior withdrawal without liberty; res judicata inapplicable.

JUDGMENT

(Hybrid Mode)

Per: Barun Mitra, Member (Technical)

The present appeal filed under Section 61 of Insolvency and Bankruptcy Code 2016 (‘IBC’ in short) by the Appellant arises out of the Order dated 23.09.2024 (hereinafter referred to as ‘Impugned Order’) passed by the Adjudicating Authority (National Company Law Tribunal, Kolkata Bench-II) in C.P. (IB) No. 146/KB/2023. By the impugned order, the Adjudicating Authority has dismissed Section 7 petition filed by the Appellant/Financial Creditor- Subham Capital Private Limited for initiation of Corporate Insolvency Resolution Process (‘CIRP’ in short) of the Corporate Debtor–Vedic Realty Private Limited. Aggrieved by the Impugned Order, the present appeal has been preferred by the Appellant-Financial Creditor.

2. Coming to the sequence of events of the present case, it is relevant to notice that at the behest of Corporate Debtor, the Appellant, basis an oral understanding, extended financial assistance by way of disbursal of loans aggregating Rs 22.75 Cr between 2011 and 2016 in several tranches. These loan transactions which carried an interest liability were reflected in the books of accounts of both parties and relevant bank account statements and the liability in this regard had also been acknowledged by the Respondent through confirmation letters; loan renewal acknowledgments; demand promissory notes confirming receipt of loan amounts besides issue of post-dated cheques towards repayment of principal and interest. The Respondent-Corporate Debtor defaulted after the last tranche of re-payment made on 07.04.2021, following which the Appellant first issued a recall notice dated 01.03.2022 and then filed a Section 7 petition vide C.P(IB)No. 215 of 2022. Subsequently, the parties executed a Settlement Agreement dated 18.11.2022 wherein the Respondent acknowledged the outstanding liability and agreed to repay the same as per an agreed schedule which led to withdrawal of CP(IB)No. 215 of 2022 by the Appellant. However, as the Respondent failed to comply with the settlement terms, the Appellant filed CP(IB) No.146 of 2023 under Section 7 of the IBC seeking initiation of CIRP of the Corporate Debtor. Despite being given several opportunities, the Respondent failed to file its reply. Hence, their right to file reply was closed on 08.01.2024 by the Adjudicating Authority and the matter was set ex-parte and admitted the Section 7 petition vide CP No. 146 of 2023 on 25.01.2024. The Respondent filed IA No. 286 of 2024 under Section 60(5) of IBC seeking recall of the CIRP admission order. The Adjudicating Authority disposed of IA No. 286 of 2024 on 09.02.2024 recalling the Section 7 admission order and allowing the Respondent to file their reply. The Appellant filed an appeal before this Tribunal challenging the recall order of the Adjudicating Authority dated 25.01.2024 on which this Tribunal without interfering with the recall order issued directions on 12.03.2024 to the Adjudicating Authority to consider the CP(IB) No. 146 of 2023 in accordance with law. The Section 7 petition vide No. 146 of 2023 filed by the Appellant was considered and dismissed by the Adjudicating Authority on 23.09.2024. Aggrieved by the said order, the present appeal has been preferred by the Appellant-Financial Creditor.

3. Making submissions on behalf of the Appellant, Shri Gaurav Mitra, Ld. Counsel for the Appellant submitted that the present Section 7 proceeding arose out of multiple loan disbursements made between 2011 to 2016 by the