{"id":261733,"date":"2022-02-14T13:00:59","date_gmt":"2022-02-14T07:30:59","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=261733"},"modified":"2022-02-25T10:11:42","modified_gmt":"2022-02-25T04:41:42","slug":"in-case-of-an-application-being-filed-under-s-7-of-ibc-will-insufficiency-of-stamp-duty-be-looked-into","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2022\/02\/14\/in-case-of-an-application-being-filed-under-s-7-of-ibc-will-insufficiency-of-stamp-duty-be-looked-into\/","title":{"rendered":"In case of an application being filed under S.7 of IBC, will insufficiency of stamp duty be looked into? NCLT decides"},"content":{"rendered":"

National Company Law Tribunal, Mumbai: <\/strong>The Coram of H.V. Subba Rao, Judicial Member addressed the relevancy of insufficiency of stamp duty under Section 7 proceedings of Insolvency and Bankruptcy Code, 2016<\/p>\n

\n

\u201c\u2026a Section 7 application under the IBC can be filed in a simple form prescribed in the Code even without any pleadings.\u201d<\/span><\/p>\n<\/blockquote>\n

Point of Reference:<\/p>\n

Whether the Debenture Trust Deed dated 1st March, 2014 and Redeemable Non-Convertible Debenture Subscription Agreement dated 1st March, 2014, shall be impounded and be sent for payment of requisite stamp duty in accordance with the Maharashtra Stamp Act?<\/p>\n

Background<\/p>\n

Main company petition was filed by M\/s Vistara ITCL (India) Limited as Financial Creditors against M\/s Satra Properties (India) Limited who was the Corporate Debtor under Section 7 of the Code for initiation of insolvency proceedings against the Corporate Debtor.<\/p>\n

During the pendency of the above-stated Company Petition, the Corporate Debtor filed a Miscellaneous Application.<\/p>\n

Petitioner\/Corporate Debtor contended that the (i) Secured Redeemable Non-Convertible Debenture Subscription Agreement dated 1st March 2014 and the (ii) Debenture Trust Deed dated 1st March 2014 filed in the Company Petition cannot be looked into nor relied upon by the Financial Creditors till the deficit stamp duty payable on the above two instruments is paid in accordance with the provisions of the Maharashtra Stamp Act.<\/p>\n

Both the members of the tribunal had ordered initiation of CIRP against the Corporate Debtor vide an order concurring with each other and by observing that the \u2018debt\u2019 and \u2018default\u2019 stood proved even without relying on the Debenture Trust Deed and NCD Subscription Agreement.<\/p>\n

Judicial Member went ahead and partially allowed the Miscellaneous Application while holding that the Debenture Trust Deed and Redeemable Non-Convertible Debenture Subscription Agreement shall be impounded and be sent for payment of requisite Stamp Duty in accordance with Maharashtra Stamp Act and issued necessary directions to the Registrar. <\/strong><\/p>\n

Whereas, the Technical Member without expressing any opinion on the issue of stamp duty directed the Registry to immediately place the record before the President for constituting appropriate Bench for an opinion so that the order in M.A is rendered in accordance with the majority opinion.<\/p>\n

Hence, the above M.A. was referred for independent opinion of the third member.<\/p>\n

Core Issues:<\/p>\n