Insolvency plea permitted against Supreme Infrastructure BOT
In their representation of SREI Infrastructure, attorneys Rohit Gupta and Ativ Patel of AVP Partners contended that Supreme Infrastructure India Ltd. (SIIL), not the borrower, was the intended beneficiary of the intercreditor agreement (ICA) from June 2019. Furthermore, the ICA was only good for 180 days, yet throughout that time, no agreement was made.
According to the requirements of the Insolvency and Bankruptcy Code, the borrower had argued that the financial creditor is going through an insolvency procedure of its own. As a result, the lender's account has been deemed fake, and as a result, it is no longer permitted to pursue the bankruptcy claim against Supreme Infrastructure BOT.
The tribunal made it clear that even while they were subject to CIRP, the financial creditor was still able to file and prosecute claims against the corporate debtor.
Further, it rejected the corporate debtor's plea that the existence of an arbitration clause in the loan agreement should bar the financial creditor from approaching the tribunal, citing the Supreme Court's precedent in an earlier matter.