In Brief
A consortium of banks led by SBI sought recognition as financial creditors of Reliance Infratel Limited based on corporate guarantees executed to secure loans to related entities. Lower tribunals rejected the claims, citing irregular timing, poor stamping, and inadequate verification. The Supreme Court held that corporate guarantees constitute "financial debt" under the Insolvency Code, making the banks financial creditors. The Court ruled that insufficient stamping is a curable defect and cannot defeat substantive claims, and that proper verification had occurred. The lower tribunal orders were set aside and the banks were recognized as financial creditors.
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