# In the matter of EPC Constructions India vs. Matix Fertilisers and Chemicals Limited

> NCLAT judgment dated 2025-04-09. Citation: TCN-2025-NCLAT-00110. The appeal challenges the order dated 29.08.2023 passed by the Adjudicating Authority…

- **Court:** NCLAT
- **Order date:** 9 Apr 2025
- **Citation:** TCN-2025-NCLAT-00110
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/epc-constructions-india-vs-matix-fertilisers-and-chemicals-limited-80192d21

## Summary

### Background

The appeal challenges the order dated 29.08.2023 passed by the Adjudicating Authority (National Company Law Tribunal), Division Bench, Court No. II, Kolkata in C.P. (IB) No.156/KB/2022, which rejected a Section 7 application filed by EPC Constructions India Limited (Appellant) against Matix Fertilisers and Chemicals Limited (Respondent). The Appellant had executed an EPC contract with the Respondent for setting up a fertilizer complex. Disputes arose regarding amounts due, leading to the Appellant receiving Cumulative Redeemable Preference Shares (CRPS) from the Respondent. Subsequently, CIRP was initiated against the Appellant, and the Respondent adjusted the CRPS against its claim in the CIRP. The Liquidator of the Appellant filed a Section 7 application claiming

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## Facts

EPC Constructions India Limited (Appellant) and Matix Fertilisers and Chemicals Limited (Respondent) entered into an EPC contract for setting up a fertilizer complex in West Bengal on 11.12.2009. In 2010, contracts for onshore and offshore supply, engineering, and construction were entered. Amounts became due from the Respondent to the Appellant. On 28.04.2015, the Respondent requested the Appellant to consider converting the outstanding amounts into subordinated debt. On 08.05.2015, the Appellant sent an agreement to give extended credit up to Rs.403 Crores against receivables from Matix. On 30.07.2015, the Appellant passed a resolution to invest up to Rs.400 Crores into 8% Cumulative Redeemable Preference Shares (CRPS) of Matix. On 26.08.2015, the Respondent agreed

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## Issues and analysis

### Issue 1: Whether a Preference Shareholder …

**Ratio:** A Preference Shareholder cannot step into the shoes of a creditor of the Company unless

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**Reasoning:** The Adjudicating Authority concluded that no case of any debt due to the Appellant and no

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**Interpretation:** The interpretation hinges on whether preference shares, particularly when not

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**Application:** In this case, the Appellant held CRPS, but the Respondent never declared

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## Parties

- **Judges:** Ashok Bh…; Barun M…
- **Appellants:** EPC Constructions…
- **Respondents:** M/S Matix…
- **Advocates:** Niranjan…; Abhishek S…; +6 more

## Timeline

- **2009-12-11 — EPC Contract E…**: EPC Constructions India Limited (Appellant) executed an EPC contract with Matix…
- **2015-04-28 — Request for Debt…**: The Respondent requested the Appellant to consider converting the outstanding amounts…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 5(8) — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-5)

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