# in the matter of HDO Technologies Ltd. CP.No 720-MAH-2017

> NCLT judgment dated 2017-04-28. Citation: TCN-2017-NCLT-00876. Bank of India filed an insolvency petition against HDO Technologies Limited under Section 7 of…

- **Court:** NCLT
- **Order date:** 28 Apr 2017
- **Citation:** TCN-2017-NCLT-00876
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/hdo-technologies-ltd-cpno-720-mah-2017-60bb8308

## Summary

### Background

Bank of India filed an insolvency petition against HDO Technologies Limited under Section 7 of the Insolvency and Bankruptcy Code, 2016, due to default in payment of credit facilities amounting to Rs. 162,31,99,387 as of 31-03-2017. The corporate debtor's account was classified as a non-performing asset. The financial creditor sought initiation of the insolvency resolution process.

## Facts

Bank of India sanctioned credit facilities to HDO Technologies Limited amounting to Rs. 147.44 crores on 06-08-2014, including working capital term loans, funded interest term loans, cash credit, letters of credit, and bank guarantees. The corporate debtor defaulted on payments, leading to the account being classified as a non-performing asset on 31-12-2014. The outstanding amount as of 31-03-2017 was Rs. 162,31,99,387. The financial creditor sent letters to the corporate debtor disclosing the position of the account and seeking acknowledgment of the balance, which the corporate debtor confirmed. The corporate debtor conceded to the initiation of the Insolvency Resolution Process. The relevance of these facts is to establish the financial debt and default, which are

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## Issues and analysis

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

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

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**Reasoning:** The Bench observed that the corporate debtor defaulted in making payments, and the

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**Interpretation:** Section 7 provides the mechanism for financial creditors to trigger the

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**Application:** The Bench applied Section 7 by verifying the default and the completeness of

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## Parties

- **Judges:** B.S.V. Prakash…; V. Nallasen…
- **Appellants:** Bank of…
- **Respondents:** HDO Technologies…

## Timeline

- **2014-08-06 — Sanction of Credit…**: Bank of India sanctioned credit facilities to HDO Technologies Limited amounting to Rs.…
- **2014-12-31 — Account Classified as…**: The account of HDO Technologies Limited was…

## 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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