Question

Under Section 2(g), the definition of 'debt' includes which of the following liabilities?

Q: Answer-Under Section 2(g), the definition of 'debt' includes which of the following liabilities?

Section 2g defines debt broadly as any liability inclusive of interest claimed as due from any person by a bank or financial institution or consortium - during the course of any business activity - in cash or otherwise, whether secured or unsecured, or assigned, or payable under a decree or order of a civil court, or an arbitration award, or under a mortgage, and subsisting and legally recoverable on the date of application. The 2016 Amendment added liability towards debt securities unpaid after a 90-day notice by the debenture trustee. The definition is intentionally wide, encompassing all forms of financial liability, regardless of the mode of creation, which is central to the jurisdiction of DRTs.

A Only secured loans from banks, excluding arbitration awards

B Only liabilities payable under decrees of civil courts, not contractual debts

C Any liability (inclusive of interest) claimed as due from any person by a bank or financial institution, whether secured or unsecured, or assigned, or payable under a decree, arbitration award, or mortgage

D Only liabilities exceeding Rs. 10 lakh in any single transaction

E Only liabilities arising from cash transactions, excluding liabilities in kind

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