# In the matter of Mascot Capital and Marketing Private Limited (MCMPL) vs. Savair Energy Limited (SEL)

> NCLAT judgment dated 2023-09-27. Citation: TCN-2023-NCLAT-00158. The appeal was filed under Section 61 of the Insolvency and Bankruptcy Code, 2016 by Mascot…

- **Court:** NCLAT
- **Order date:** 27 Sept 2023
- **Citation:** TCN-2023-NCLAT-00158
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/mascot-capital-and-marketing-private-limited-mcmpl-vs-savair-energy-limited-6b87389e

## Summary

### Background

The appeal was filed under Section 61 of the Insolvency and Bankruptcy Code, 2016 by Mascot Capital and Marketing Private Limited (MCMPL), the Financial Creditor, against the order dated 20.01.2023 passed by the Adjudicating Authority (National Company Law Tribunal, Mumbai Bench – IV) in C.P. (IB) No.4426/MB–IV/2019. The Adjudicating Authority had dismissed the application filed by the Financial Creditor under Section 7 of IBC, 2016 against Savair Energy Limited, the Corporate Debtor, for initiation of Corporate Insolvency Resolution Process (CIRP). The application before the Adjudicating Authority was filed by the Financial Creditor on 06.12.2019 under Section 7 of the IBC, 2016, seeking initiation of CIRP against the Corporate Debtor. The Financial Creditor had filed

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## Facts

Mascot Capital and Marketing Private Limited (MCMPL), the Financial Creditor, filed an appeal against the order dated 20.01.2023 passed by the Adjudicating Authority (National Company Law Tribunal, Mumbai Bench – IV), which dismissed its application under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016, for initiating Corporate Insolvency Resolution Process (CIRP) against Savair Energy Limited, the Corporate Debtor. The Financial Creditor's application was based on a default amount of Rs.3,70,00,000/-, comprising a principal amount of Rs.3,20,00,000/- and interest dues of Rs.50,00,000/-. The Adjudicating Authority noted that the 'date of default' was not explicitly mentioned in Part IV of Form – I but was derived from a Memorandum of Understanding (MoU)

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority erred in dismissing the application under Section 7 of the IBC, …

**Ratio:** The Adjudicating Authority should have admitted the Application of the Appellant under

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**Reasoning:** The Corporate Debtor had accepted before the AA that it is not in a position to repay

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**Interpretation:** Section 7 of the IBC allows a financial creditor to initiate CIRP against a

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**Application:** The court found that the Corporate Debtor admitted to defaulting on the debt

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## Parties

- **Judges:** Anant Bijay…; Ajai Das Me…
- **Appellants:** Mascot Capital…
- **Respondents:** Savair Energy…; Savair Energy…

## Timeline

- **2017-03-04 — MoU between Financial Creditor and Corporate…**: Financial Creditor and Corporate Debtor entered into an MoU to work jointly for execution…
- **2017-03-10 — Transactio…**: RTGS/SK/UTIBR52017031000…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 61 — Appeals and Appellate Authority](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-61)

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