# In the matter of Concast Infratech Limited CP (IB) No. 226-KB-2018

> NCLT judgment dated 2018-06-12. Citation: TCN-2018-NCLT-01288. Srei Equipment Finance Limited filed an application under Section 7 of the Insolvency and…

- **Court:** NCLT
- **Order date:** 12 Jun 2018
- **Citation:** TCN-2018-NCLT-01288
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/concast-infratech-limited-cp-ib-no-226-kb-2018-2eb8bb88

## Summary

### Background

Srei Equipment Finance Limited filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Concast Infratech Limited, seeking to initiate the Corporate Insolvency Resolution Process (CIRP). The application was based on the corporate debtor's default on loan repayments. The financial creditor contended that the corporate debtor availed two loans aggregating to Rs. 69,120,408/- under loan agreements executed in December 2013. The corporate debtor defaulted on monthly installments starting February 2016, leading to arbitration proceedings and subsequent terms of settlement. Despite initial payments under the settlement, defaults continued from May 2016, prompting the financial creditor to issue a final demand notice in July 2017.

## Facts

Srei Equipment Finance Limited (Financial Creditor) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Concast Infratech Limited (Corporate Debtor). The Corporate Debtor availed two loans aggregating to Rs. 69,120,408/- under loan agreements executed in December 2013. The Corporate Debtor provided a corporate guarantee under a corporate guarantee agreement dated 31st December, 2013. A personal guarantee was also given by Mr. Sanjay Kumar Sureka. The Corporate Debtor defaulted on monthly installments starting February 2016. Arbitration proceedings were initiated, leading to terms of settlement. Initial payments were made under the settlement, but defaults continued from May

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## Issues and analysis

### Issue 1: Whether the application under Section 7 of the Insolvency and Bankruptcy Code, 2016 is maintainable …

**Ratio:** The Hon'ble NCLAT in Innoventive Industries Ltd. vs. ICICI Bank & Anr. laid down the

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**Reasoning:** The adjudicating authority relied on the NCLAT's decision in Innoventive Industries Ltd.

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**Interpretation:** Section 7 of the IBC, 2016, allows a financial creditor to initiate CIRP

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**Application:** The adjudicating authority found that the financial creditor had provided

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## Parties

- **Judges:** Jinan…; Madan B.…
- **Respondents:** Concast Infratech…

## Timeline

- **2013-12-31 — Loan Agre…**: Corporate Debtor availed two loans aggregating to Rs.69,120,408/- by executing two…
- **2016-02-03 — Default Comme…**: Corporate Debtor started committing default…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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