# In the matter of Albus India Limited (IB)-1089(ND)-2018

> NCLT judgment dated 2019-01-02. Citation: TCN-2019-NCLT-05338. TUF Metallurgical (P) Ltd. filed a petition against Albus India Limited under Section 7 of the…

- **Court:** NCLT
- **Order date:** 2 Jan 2019
- **Citation:** TCN-2019-NCLT-05338
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/albus-india-limited-ib-1089nd-2018-31396be5

## Summary

### Background

TUF Metallurgical (P) Ltd. filed a petition against Albus India Limited under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016, seeking initiation of the corporate insolvency resolution process (CIRP). The case arises from a financial assistance agreement between the parties, where TUF Metallurgical provided financial assistance to Albus India Limited. Albus India Limited failed to repay the loan as per the agreement, leading to the filing of this petition.

## Facts

TUF Metallurgical (P) Ltd. (Operational Creditor) and Albus India Limited (Corporate Debtor) had business relationships. The Corporate Debtor approached the Financial Creditor for financial assistance in the last quarter of 2016. The Financial Creditor disbursed Rs. 2,51,44,385/- between October 2016 and March 2017, repayable by June 30, 2017, with 24% interest per annum. The financial assistance was renewed via a Finance Facility/Share Pledge Agreement dated 04.04.2017. A demand promissory note dated 17th April, 2017, was executed. The Corporate Debtor offered to pledge shares worth Rs. 5 crores as security. Albus Conserves Pvt. Ltd., a sister concern, offered security via an equitable mortgage. The Corporate Debtor failed to repay the loan as per the agreement dated

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## Issues and analysis

### Issue 1: Whether the transaction between TUF Metallurgical (P) Ltd. and Albus India Limited constitutes a …

**Ratio:** Section 5(8)(f) of the IBC defines financial debt to include any amount raised under any

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**Reasoning:** The court reasoned that the execution of a demand promissory note, tender of cheques

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**Interpretation:** The court interpreted Section 5(8)(f) broadly to include transactions that have

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**Application:** The court applied the ratio to the facts of the case, noting that the various

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## Parties

- **Judges:** Ina Mal…; DeepaKr…
- **Appellants:** TUF Metallurgical…
- **Respondents:** Albus India…

## Timeline

- **2016-XX-XX — Financial Assistance…**: The Corporate Debtor approached the Financial Creditor for financial assistance in the…
- **2016-10-01 — Disbursement…**: The Financial Creditor disbursed Rs. 2,51,44,385/- in installments between October 2016…

## 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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