# In the matter of Aayusiddhi Life Sciences Private Limited CP(IB) No. 454-7-HDB-2018

> NCLT judgment dated 2020-02-13. Citation: TCN-2020-NCLT-01962. The case involves a petition filed by Mr. Gondimalla Madhu Mohan and others (Financial…

- **Court:** NCLT
- **Order date:** 13 Feb 2020
- **Citation:** TCN-2020-NCLT-01962
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/aayusiddhi-life-sciences-private-limited-cpib-no-454-7-hdb-2018-806d049c

## Summary

### Background

The case involves a petition filed by Mr. Gondimalla Madhu Mohan and others (Financial Creditors) under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Aayusiddhi Life Science Private Limited (Corporate Debtor). The Corporate Debtor was incorporated on 17.05.2006 for manufacturing pharmaceuticals. The Financial Creditors claimed that they had extended unsecured loans to the Corporate Debtor, which the Corporate Debtor failed to repay. The Corporate Debtor, however, denied any liabilities and claimed financial fraud by the Petitioners.

## Facts

Aayusiddhi Life Sciences Private Limited, incorporated on 17.05.2006, faced financial difficulties and sought loans from Mr. Gondimalla Madhu Mohan and three others (Financial Creditors). The authorized share capital of the Corporate Debtor was ₹8,00,00,000, while the paid-up capital was ₹7,38,50,000. Between 15.11.2011 and 28.09.2014, Mr. Gondimalla Madhu Mohan extended an unsecured loan of ₹1,07,62,000. He also advanced ₹2,74,65,773 by repaying outstanding dues of the Corporate Debtor to third parties, totaling ₹3,82,27,773. The Corporate Debtor repaid ₹58,99,728 and allotted equity shares worth ₹1,13,00,000. Other Financial Creditors, including Mr. Kolanu Jaya Reddy, Mr. K. Subba Reddy, and Mr. Pabba Amarnath, also advanced loans. The Corporate Debtor admitted to

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## Issues and analysis

### Issue 1: Whether the Petitioners are Financial …

**Ratio:** A financial creditor is defined under the Insolvency and Bankruptcy Code as a person to

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**Reasoning:** The Adjudicating Authority considered the evidence presented by the Petitioners,

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**Interpretation:** The definition of 'financial creditor' under the IBC encompasses those to whom

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**Application:** Based on the Corporate Debtor's own financial records, the Petitioners were

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## Parties

- **Judges:** K. Anantha…; BINOD KUMAR…
- **Appellants:** Gondimalla Madhu…
- **Respondents:** Aayusiddhi Life…

## Timeline

- **2006-05-17 — Incorporation of…**: Aayusiddhi Life Science Private Limited was incorporated for the manufacture of…
- **2011-11-15 — Loan Extensio…**: Mr. Gondimalla Madhu Mohan extended an unsecured loan of ₹1,07,62,000 to the Corporate…

## 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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