# In the matter of Kaizen Power Limited CP(IB) No. 254-KB-2019

> NCLT judgment dated 2019-12-13. Citation: TCN-2019-NCLT-00184. Uco Bank, a financial creditor, filed an application under Section 7 of the Insolvency and…

- **Court:** NCLT
- **Order date:** 13 Dec 2019
- **Citation:** TCN-2019-NCLT-00184
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/kaizen-power-limited-cpib-no-254-kb-2019-af1f6665

## Summary

### Background

Uco Bank, a financial creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Kaizen Power Limited, the corporate debtor, due to a default of Rs. 170.20 Crore. The financial creditor had sanctioned term loans and foreign letters of credit with bank guarantee facilities to the corporate debtor, who subsequently defaulted on payments. The corporate debtor argued that the application was not maintainable due to limitation, non-compliance with RBI guidelines, and non-disbursement of the full loan amount.

## Facts

Uco Bank sanctioned term loans and foreign letters of credit to Kaizen Power Limited. The corporate debtor defaulted on payments, leading to the account being declared as NPA on 05.11.2014. The financial creditor claimed a default of Rs. 170.20 Crore. The corporate debtor argued that the application was not maintainable due to limitation, non-compliance with RBI guidelines, and non-disbursement of the full loan amount. The financial creditor contended that the debt was not barred by limitation due to acknowledgements of debt in the corporate debtor's financial statements. The corporate debtor's financial statements for the year ended 31st March, 2017, showed the amount of long-term borrowings and defaults in payment of interest. The corporate debtor also submitted a

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## Issues and analysis

### Issue 1: Whether the person who signed and …

**Ratio:** An authorized representative of the

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**Reasoning:** The application was signed by Mr. B.Mondal, Dy. General Manager, who was authorized by

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**Interpretation:** The NCLT interpreted the authorization documents and concluded that Mr.

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**Application:** The NCLT found that Mr. B.Mondal was authorized to file the application, thus

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## Parties

- **Judges:** Madan B.…; Virendra Kumar…
- **Appellants:** UCO B…
- **Respondents:** Kaizen Power…

## Timeline

- **2010-06-21 — Sanction Lett…**: Date of the sanction letter for term loans and foreign letter of credit with bank…
- **2012-08-30 — Execution of A…**: Execution of various agreements…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 73 — Punishment for false representations to creditors](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-73)

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