# In the matter of Konark Power Projects Ltd. CP (IB) No. 314-7-HDB-2017

> NCLT judgment dated 2018-08-28. Citation: TCN-2018-NCLT-00885. The case pertains to a petition filed by Sri P. Krishna, styling himself as a Financial…

- **Court:** NCLT
- **Order date:** 28 Aug 2018
- **Citation:** TCN-2018-NCLT-00885
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/konark-power-projects-ltd-cp-ib-no-314-7-hdb-2017-85f5f3e6

## Summary

### Background

The case pertains to a petition filed by Sri P. Krishna, styling himself as a Financial Creditor, seeking the commencement of the Corporate Insolvency Resolution Process (CIRP) against Konark Power Projects Limited, referred to as the Corporate Debtor. The applicant claims that the Corporate Debtor defaulted on an unsecured loan of Rs. 1,00,00,000 (Rupees One Crore) provided under a loan agreement in April 2017. The loan carried a simple interest of 12% per annum. The Corporate Debtor made partial payments, but a significant amount remained outstanding. The applicant issued reminders, but the Corporate Debtor failed to repay the loan. The Corporate Debtor argued that it faced financial difficulties due to the termination of a Power Purchase Agreement (PPA) and

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## Facts

Sri P. Krishna, the Financial Creditor, filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate the Corporate Insolvency Resolution Process (CIRP) against Konark Power Projects Limited, the Corporate Debtor. In April 2017, the Financial Creditor provided an unsecured loan of Rs. 1,00,00,000 (Rupees One Crore) to the Corporate Debtor, with a simple interest rate of 12% per annum. The loan agreement stipulated a repayment period of ten years starting from 20.11.2007. The Corporate Debtor made partial payments of Rs.21,37,000/- on 30.12.2013, Rs.5,00,000/- on 20.01.2014, and Rs.7,63,000/- on 06.02.2014. As of 31.03.2018, the principal outstanding was Rs.66,00,000/-, and the total interest due was Rs.1,14,22,256/-. The maturity

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority is satisfied that a default has occurred in respect of a …

**Ratio:** The legal principle applied is that under Section 7 of the Insolvency and Bankruptcy

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**Reasoning:** The Adjudicating Authority noted that the Respondent admitted the claim of the Petitioner

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**Interpretation:** This issue involves interpreting Section 7 of the IBC, which requires the

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**Application:** In this specific case, the Corporate Debtor's admission of the debt and the

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## Parties

- **Judges:** BIKKI RAVEENDRA…
- **Appellants:** Perna Kr…
- **Respondents:** Konark Power…

## Timeline

- **2007-11-20 — Loan Agreement Start…**: The ten-year period for…
- **2013-12-30 — Partial P…**: Corporate Debtor paid…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 5(8) — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-5)

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