# In the matter of M/s Ravinder Construction Company Vs. Kalinga Sponge Iron Ltd.,Company Appeal(AT)(Ins) No. 201 of 2022

> NCLAT judgment dated 2022-12-08. Citation: TCN-2022-NCLAT-00044. This case involves an appeal against an order dated 22nd November 2021, passed by the…

- **Court:** NCLAT
- **Order date:** 8 Dec 2022
- **Citation:** TCN-2022-NCLAT-00044
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/ms-ravinder-construction-company-vs-kalinga-sponge-iron-ltdcompany-appeal-65b4f668

## Summary

### Background

This case involves an appeal against an order dated 22nd November 2021, passed by the Adjudicating Authority (National Company Law Tribunal, Cuttack Bench, Cuttack) in T.P. No.28/CTB/2019 in C.P. (IB) No.1206/KB/2018, which dismissed the application filed by the Appellant, M/s Ravinder Construction Company, against the Corporate Debtor, Kalinga Sponge Iron Limited. The Appellant sought initiation of CIRP against the Corporate Debtor based on an alleged default in paying a financial debt.

## Facts

M/s Ravinder Construction Company, through its sole proprietor Mr. Ravinder Singh, filed an application under Section 7 of the I&B Code, 2016, against Kalinga Sponge Iron Limited, seeking initiation of CIRP. The Appellant claimed that the Corporate Debtor defaulted in paying a financial debt of Rs.4,62,92,880/-. Mr. Ravinder Singh was previously a director of the Corporate Debtor until 28.07.2017. The Corporate Debtor's account was classified as NPA on 13.02.2013, with a default amount of Rs.8,55,05,409/-. The Corporate Debtor argued that a Memorandum of Understanding (MoU) dated 22.06.2017 was entered into between the erstwhile and present directors, settling all liabilities. The Corporate Debtor issued a letter dated 12.04.2018, confirming that the net liability

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## Issues and analysis

### Issue 1: Whether the Appellant has established the existence of a financial debt and default on the part of …

**Ratio:** The financial creditor must furnish a record of default and establish that a default has

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**Reasoning:** The Tribunal found that the Appellant failed to provide sufficient documentary evidence

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**Interpretation:** Section 7 of the I&B Code requires the financial creditor to furnish

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**Application:** In this case, the Appellant failed to meet the burden of proof. The Tribunal

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## Parties

- **Judges:** Rakesh Kuma…; KanthiNar…
- **Appellants:** M/s Ravinder…
- **Respondents:** Kalinga Sponge…
- **Advocates:** Praveen C…; Aakash…; +5 more

## Timeline

- **2013-02-13 — Account Classified as…**: The Corporate Debtor's…
- **2017-06-22 — Memorandum of…**: MoU entered into between the erstwhile and…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

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