In Swiss Ribbons Pvt Ltd v Union of India (2019), why did the Supreme Court reject the challenge that…
In Swiss Ribbons (2019) the Supreme Court held that "financial creditors are, from the very beginning, involved with assessing the viability of the corporate debtor" and are…
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In Swiss Ribbons Pvt Ltd v Union of India (2019), why did the Supreme Court reject the challenge that the Code discriminates between financial creditors and operational creditors?
Answer and explanation
Correct answer B
In Swiss Ribbons (2019) the Supreme Court held that "financial creditors are, from the very beginning, involved with assessing the viability of the corporate debtor" and are "clearly different from operational creditors", so the classification is valid. It also noted that most financial creditors, particularly banks, are secured creditors. Article 14 applies to economic legislation, though the Court gives such laws greater latitude.
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