# In the matter of Mukesh Kumar vs. Ambrane India Pvt. Ltd.

> NCLAT judgment dated 2023-07-05. Citation: TCN-2023-NCLAT-00404. The case involves an appeal against the order of the Adjudicating Authority (National Company…

- **Court:** NCLAT
- **Order date:** 5 Jul 2023
- **Citation:** TCN-2023-NCLAT-00404
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/mukesh-kumar-vs-ambrane-india-pvt-ltd-83bd2242

## Summary

### Background

The case involves an appeal against the order of the Adjudicating Authority (National Company Law Tribunal, New Delhi) which initiated Corporate Insolvency Resolution Process (CIRP) against MP Promoters Pvt Ltd based on an application filed by Ambrane India Pvt Ltd, a financial creditor, under Section 7 of the Insolvency and Bankruptcy Code (IBC). The financial creditor claimed that it had granted a loan of Rs.1,01,00,000/- to the corporate debtor, which was to be repaid with interest. The corporate debtor defaulted on the repayment, leading to the initiation of CIRP.

## Facts

In April 2017, MP Promoters Pvt Ltd (Corporate Debtor) approached Ambrane India Pvt Ltd (Financial Creditor) for financial assistance. On May 20, 2017, the Board of Directors of Ambrane India Pvt Ltd resolved to grant a loan of Rs.1,01,00,000/- to MP Promoters Pvt Ltd at an interest rate of 9% per annum, compounded on March 31, 2018. The loan was to be disbursed in tranches. On May 26, 2017, Rs.51 lakh was disbursed via cheque, and on June 3, 2017, Rs.50 lakh was disbursed via RTGS. The Corporate Debtor failed to repay the loan by March 31, 2018. On August 6, 2019, the Financial Creditor sent a legal notice to the Corporate Debtor. On September 26, 2019, Ambrane India Pvt Ltd filed an application under Section 7 of the IBC to initiate CIRP against MP Promoters Pvt Ltd.

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority was correct in admitting the application under Section 7 of the …

**Ratio:** The Adjudicating Authority is empowered to admit an application under Section 7 of the

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**Reasoning:** The NCLAT reasoned that the Adjudicating Authority had rightly passed the impugned order,

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

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**Application:** In this case, the NCLAT applied the principle that the absence of a written

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## Parties

- **Judges:** Rakesh…; Alok Sriv…
- **Appellants:** MUKESH…
- **Respondents:** MP Promoters Pvt.…; Ambrane India Pvt…
- **Advocates:** Abhishek…; Nipun G…; +1 more

## Timeline

- **2017-04-01 — Corporate Debtor…**: MP Promoters Pvt Ltd approached Ambrane…
- **2017-05-20 — Board Resolution for…**: Board of Directors of Ambrane India Pvt Ltd resolved to grant a loan of Rs.1,01,00,000/-…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 61(1) — Appeals and Appellate Authority](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-61)

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