Related-party status is assessed based on the relationship existing at the time the underlying transactions were entered into; subsequent changes in shareholding or management cannot retrospectively remove the classification of a related party for those specific transactions.

ORDER

The present Application has been filed by Mona Portfolio Ltd.(hereinafter referred to as the Applicant Company), through its RP i.e Mr. Kailash Shah under section 60(5) read with section 42 of the Insolvency and Bankruptcy Code (hereinafter referred to as the Code) forseeking inter alia, to direct the Resolution Professional(RP) to take the claim of the Applicant on record against the Corporate Debtor under the category of Financial Creditor (as an unrelated party).

BRIEF FACTS:

2. Brief facts of the case, as averred by the Applicant, are as under:

(a) The Application is preferred on behalf of the Applicant Company- a public limited company and erstwhile Non Banking Financial Company which is under CIRP vide NCLT, New Delhi Order dated 05.12.2024 in Plaza Commercial Private Limited vs. Mona Portfolio Limited [CP (IB) No. 585 of 2024] (Annexure A-1) wherein Mr. Kailash Shah was appointed as the RP vide Order dated 11.02.2025 (Annexure A-2). The Applicant, being aggrieved by the arbitrary and non-speaking classification of its claim by the RP of the Corporate Debtor as a "Related Party" instead of an independent Financial Creditor. As recorded vide this Tribunal Order dated 15.04.2025 in the Applicant's earlier I.A. No. 561 of 2025, the Ld. Counsel for the RP stated that "the amount which is claimed by the applicant in this application has already been admitted by RP as a related party." The Applicant submits that such classification is legally untenable under the Code and gravely prejudices the Applicant's statutory rights, leaving the Applicant with no alternative but to file the present Application seeking directions to the RP to rectify the records and admit the Applicant company’s claim as that of an independent Financial Creditor.

(b) The Applicant Company incorporated on 13.03.1996, was granted an RBI Certificate of Registration on 04.04.2001 to operate as a non-public deposit-accepting NBFC. In the ordinary course of business, the Applicant Company advanced credit facilities to the Corporate Debtor from FY 2014-2015 to FY 2023-2024 on a running account basis, reflecting periodic disbursements and repayments as evidenced by its ledger account. Subsequently, through a Memorandum of Understanding dated 17.06.2018 (Annexure A-5), the Applicant Company was completely taken over by a new management team for valuable consideration, whereby the shareholding and control of the erstwhile promoter-directors- who were related to the Corporate Debtor, were entirely transferred to unrelated individuals during FY 2018-2019, thereby severing any "related party" status.

(c) During FY 2018-2019, the Applicant Company effectuated the transfer of control through multiple share transfers, as evidenced by Board Resolutions dated 01.04.2018 and 22.09.2018 (Annexures A-6 & A-7) and the shareholder register as of 31.03.2019 (Annexure A-8), thereby demonstrating that the Applicant Company ceased to be a related party to the Corporate Debtor post-FY 2018-2019. The Applicant Company submitted that the delay in updating the Ministry of Corporate Affairs portal regarding the Memorandum of Understanding dated 17.06.2018 was strictly due to the statutory requirement for prior RBI approval, given the Applicant Company’s status as a registered NBFC at the material time.