Damji Ramji Shah vs Edelweiss Asset Reconstruction Company Ltd. & Anr

Heard Learned Counsel for the Appellant.

This appeal has been filed against the order dated 17.03.2023 by which order Adjudicating Authority has admitted Section 7 application filed by the Respondent No. 1 ‘Edelweiss Asset Reconstruction Company Ltd’.

Learned Counsel for the Appellant submits that the Applicant who has initiated Section 7 application has no authority or jurisdiction to initiate Section 7 application.

The Adjudicating Authority by the impugned order has considered all the submissions raised and had found that ‘debt and default’ proved.

Learned Counsel for the Respondent has referred to the Trust Deed dated 25.03.2019 wherein Clause (l), the following was clearly stated: -

“(l) to take all actions that may be necessary to realise the Financial Assets that form part of the Trust Fund, including initiating legal proceedings, enforcing any Security Interest, changing the management of any Borrower and exercising any other rights that it may be entitled to whether under law, contract or otherwise.”

Debt and default having been proved in Section 7 application, we don’t find any error in the initiation of Section 7 application. The Applicant being an assignee had every right to initiate the Section 7 application.

Learned Counsel for the Appellant lastly submits that steps are being taken for settlement with the Financial Creditor. In the event, if the settlement is arrived at, it is always open for the Appellant to file Section 12A application which may be decided by the Adjudicating Authority in accordance with law.

With these observations, we dismiss the appeal.