# In the matter of Hindusthan Ispat Private Limited CP(IB)No. 319-7-HDB-2020

> NCLT judgment dated 2021-02-23. Citation: TCN-2021-NCLT-02949. The case involves a petition filed by Bollina Uma Devi, the Financial Creditor, against…

- **Court:** NCLT
- **Order date:** 23 Feb 2021
- **Citation:** TCN-2021-NCLT-02949
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/hindusthan-ispat-private-limited-cpibno-319-7-hdb-2020-66a315d4

## Summary

### Background

The case involves a petition filed by Bollina Uma Devi, the Financial Creditor, against Hindusthan Ispat Private Limited, the Corporate Debtor, under Section 7 of the Insolvency and Bankruptcy Code, 2016. The Financial Creditor alleges that the Corporate Debtor defaulted on repaying a sum of Rs. 23,01,21,100, which includes a principal amount of Rs. 20,92,01,000 and interest of Rs. 2,09,20,100 calculated at 12% per annum from 01.07.2019 to 30.04.2020. The petition seeks the initiation of the Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor, a moratorium, and the appointment of an Interim Resolution Professional (IRP).

## Facts

Bollina Uma Devi, the Financial Creditor, filed a petition against Hindusthan Ispat Private Limited, the Corporate Debtor, under Section 7 of the Insolvency and Bankruptcy Code, 2016. The Financial Creditor claimed that the Corporate Debtor defaulted on a payment of Rs. 23,01,21,100, including a principal amount of Rs. 20,92,01,000 and interest of Rs. 2,09,20,100 calculated at 12% per annum from 01.07.2019 to 30.04.2020. A Loan Agreement dated 01.07.2019 was entered into between the parties, stipulating repayment in two installments: Rs. 10.00 crores by 30.09.2019 and Rs. 10.92 crores by 31.12.2019, along with interest. The Corporate Debtor allegedly failed to make the payments as per the agreement. The Corporate Debtor denied the averments, claiming the petition was

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor defaulted in repaying …

**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 lent an amount of Rs. 20,92,01,000 to

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**Interpretation:** The existence of a Loan Agreement and the failure to adhere to its repayment

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**Application:** The Corporate Debtor's failure to repay the loan amount as per the Loan

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## Parties

- **Judges:** Bhaskara Pantula…; Veera Brahma Rao…
- **Appellants:** Bollina Um…
- **Respondents:** Hindustan Ispat…; Hindustan Ispat…

## Timeline

- **2019-07-01 — Loan Agre…**: Loan Agreement entered into between Financial Creditor and Corporate Debtor for Rs.…
- **2019-09-30 — First Install…**: First installment of Rs. 10.00 crores…

## 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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