Establishment of Financial Debt does not precluded due

The NCLT has ruled that the establishment of financial debt is not precluded due to the absence of a formal written agreement. The tribunal clarified that even without a formal written loan agreement, a financial debt can be proven through other documentary evidence. This decision provides flexibility in establishing financial debt, particularly in cases where transactions are based on informal arrangements but evidence exists of the disbursement of money against the consideration for the time value of money. It broadens the scope of evidence acceptable for initiating insolvency proceedings, ensuring that genuine financial creditors are not denied recourse due to lack of formal documentation.