# In the matter of KCT Steels Private Limited CP-433-(IB)-CB-2018

> NCLT judgment dated 2018-07-23. Citation: TCN-2018-NCLT-01097. The case pertains to an application filed by M/s. International Asset Reconstruction Company…

- **Court:** NCLT
- **Order date:** 23 Jul 2018
- **Citation:** TCN-2018-NCLT-01097
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/kct-steels-private-limited-cp-433-ib-cb-2018-0dcb61b4

## Summary

### Background

The case pertains to an application filed by M/s. International Asset Reconstruction Company Private Limited (Financial Creditor) under Section 7 of the Insolvency and Bankruptcy Code, 2016, against M/s. KCT Steels Private Limited (Corporate Debtor). The Financial Creditor sought to initiate the Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor due to outstanding debt. The Corporate Debtor was previously known as Agni Re-rollers Private Limited. The Financial Creditor claimed a total amount of Rs. 25,05,49,817.54, including principal and interest. The Corporate Debtor was proceeded ex parte due to their absence during the proceedings.

## Facts

M/s. International Asset Reconstruction Company Private Limited (Financial Creditor) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against M/s. KCT Steels Private Limited (Corporate Debtor), formerly known as Agni Re-rollers Private Limited. The Financial Creditor claimed an amount of Rs. 25,05,49,817.54, comprising Rs. 8,75,70,585.88 as principal and Rs. 15,87,59,957.80 as interest. The Corporate Debtor was proceeded ex parte due to their absence. M/s. Madhavmani Steels Private Limited approached M/s. Axis Bank Limited (previously UTI Bank Ltd., now assigned the debt to the Financial Creditor) for financial assistance. The Financial Creditor sanctioned various credit facilities, including cash credit, inland/import letter of credit,

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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, read with Rule 4 of the Insolvency

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**Reasoning:** The Adjudicating Authority examined the application and found it to be complete in all

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**Interpretation:** Section 7 allows a financial creditor to initiate CIRP against a corporate

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**Application:** The Financial Creditor's application was found to be complete, with sufficient

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## Parties

- **Judges:** CH. MOHD SHARIEF…
- **Respondents:** M/s. KCT Steels…

## Timeline

- **2004-08-07 — Sanction…**: Financial Creditor sanctioned Cash Credit, Inland/Import Letter of Creditor and Term Loan…
- **2006-11-29 — Corporate Gu…**: Corporate Debtor executed a Deed of Corporate Guarantee in favour of the Financial…

## 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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