# In the matter of Fedders Electric and Engineering Limited Company Petition No.(IB)75-ALD-2019

> NCLT judgment dated 2019-08-14. Citation: TCN-2019-NCLT-01948. The case pertains to a Company Petition filed under Section 7 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 14 Aug 2019
- **Citation:** TCN-2019-NCLT-01948
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/fedders-electric-and-engineering-limited-company-petition-noib75-ald-2019-a13238d9

## Summary

### Background

The case pertains to a Company Petition filed under Section 7 of the Insolvency and Bankruptcy Code, 2016 by State Bank of India (the Financial Creditor) against M/s Feeders Electric & Engineering Limited (the Corporate Debtor) for initiation of the Corporate Insolvency Resolution Process (CIRP). The Corporate Debtor had availed working capital facilities from a consortium of lenders, including State Bank of India. The Corporate Debtor defaulted in making payments, leading to its account being classified as a non-performing asset (NPA).

## Facts

State Bank of India, acting as the Financial Creditor, filed a petition against M/s Feeders Electric & Engineering Limited, the Corporate Debtor, under Section 7 of the Insolvency and Bankruptcy Code, 2016. The Corporate Debtor had availed working capital facilities from a consortium of lenders, including State Bank of India. The total sanctioned capital was Rs. 1435 Crores, with State Bank of India's share being Rs. 730 Crores. The Corporate Debtor defaulted in making payments, leading to its account being classified as a non-performing asset (NPA) on 2018-07-11. The Financial Creditor sent legal demand notices to the Corporate Debtor, but the Corporate Debtor failed to liquidate the outstanding amount. As of 2019-01-31, the amount claimed by the Financial

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## Issues and analysis

### Issue 1: Whether the application filed by the Financial Creditor under Section 7 of the Insolvency and …

**Ratio:** Section 7 of the Insolvency and Bankruptcy Code, 2016 allows a financial creditor to

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**Reasoning:** The NCLT observed that the Financial Creditor had annexed sufficient evidence, including

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**Interpretation:** The completeness of the application under Section 7 is crucial for initiating

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**Application:** In this case, the Financial Creditor provided the necessary documents and

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## Parties

- **Judges:** ABNI RANJAN KUMAR…; Saroj Ra…
- **Appellants:** State Bank of…
- **Respondents:** M/S FEEDERS…

## Timeline

- **1957-01-16 — Incorporation of…**: M/s Feeders Electric &…
- **2014-06-30 — Joint Deed of…**: Corporate Debtor created security on first Pari Passu charge basis hypothecation of whole…

## 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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