# In the matter of M.S.M. Energy Private Limited CP (IB)No. 506-7-HDB-2019

> NCLT judgment dated 2019-10-15. Citation: TCN-2019-NCLT-00987. The case pertains to a petition filed by Acquaint Engineers & Infrastructure Private Limited…

- **Court:** NCLT
- **Order date:** 15 Oct 2019
- **Citation:** TCN-2019-NCLT-00987
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/msm-energy-private-limited-cp-ibno-506-7-hdb-2019-ce748f61

## Summary

### Background

The case pertains to a petition filed by Acquaint Engineers & Infrastructure Private Limited (Financial Creditor) under Section 7 of the Insolvency and Bankruptcy Code, 2016, against M/s. M.S.M Energy Limited (Corporate Debtor). The Financial Creditor claimed that the Corporate Debtor defaulted on a loan agreement entered on 01.02.2012, where the Financial Creditor was to lend ₹.1,00,00,000/-. The Corporate Debtor was engaged in power generation in Maharashtra and approached the Financial Creditor for short-term funding for two 10 MW power projects.

## Facts

Acquaint Engineers & Infrastructure Private Limited (Financial Creditor) filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, against M/s. M.S.M Energy Limited (Corporate Debtor). The Corporate Debtor, engaged in power generation in Maharashtra, sought short-term funding from the Financial Creditor for two 10 MW power projects. A loan agreement was entered on 01.02.2012, where the Financial Creditor agreed to lend ₹.1,00,00,000/- at 18% interest per annum. The Financial Creditor disbursed ₹.65,59,028/- by 12.10.2018. The Corporate Debtor defaulted on payments, leading the Financial Creditor to issue reminders on 12.03.2015 and 12.10.2018. The Corporate Debtor acknowledged the debt on 22nd March, 2015 and 25th October, 2018. The total amount

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## Issues and analysis

### Issue 1: Whether the Financial Creditor has met the requirements for initiating Corporate Insolvency …

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

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**Reasoning:** The Adjudicating Authority was satisfied that the Financial Creditor had provided

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

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**Application:** The Financial Creditor provided evidence of a loan agreement, disbursement of

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## Parties

- **Judges:** Shri. K. Anantha…; Dr.Binod Kumar…
- **Appellants:** Acquaint Engineers…
- **Respondents:** M.S.M Energy…
- **Advocates:** Raja Shekar Rao…; G. Sai. P…

## Timeline

- **2012-02-01 — Loan Agre…**: The Petitioner/FC entered into a Loan…
- **2015-03-12 — Reminder…**: The Petitioner/FC issued a reminder to the…

## 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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