# In the matter of Noble Ispat & Energies Limited C.P. (IB) No. 137-BB-2019

> NCLT judgment dated 2019-08-26. Citation: TCN-2019-NCLT-01782. The case involves an application filed by M/s. Indian Renewable Energy Development Agency…

- **Court:** NCLT
- **Order date:** 26 Aug 2019
- **Citation:** TCN-2019-NCLT-01782
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/noble-ispat-energies-limited-cp-ib-no-137-bb-2019-a2533091

## Summary

### Background

The case involves an application filed by M/s. Indian Renewable Energy Development Agency Limited (IREDA) under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against M/s. Noble Ispat & Energies Limited. The application is based on the corporate debtor's alleged default on a principal outstanding amount of Rs. 14,02,00,000 as of 30.04.2018. IREDA, a Union Government Company and a Public Financial Institution, had sanctioned a term loan to Noble Ispat for setting up a captive power plant. The corporate debtor defaulted on repayments, leading to the account being classified as NPA. IREDA initiated recovery proceedings, including filing suits under Section 138 of the Negotiable Instruments Act

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## Facts

Indian Renewable Energy Development Agency Limited (IREDA), a financial creditor, filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Noble Ispat & Energies Limited, the corporate debtor. IREDA had sanctioned a term loan of Rs. 21,30,00,000 to the corporate debtor for setting up an 8MW Captive Power Plant. A loan agreement was executed on 09.05.2007, and a supplementary agreement was executed on 31.07.2009. The corporate debtor created securities in favor of IREDA. Out of the sanctioned loan, Rs. 14,02,00,000 was disbursed to the corporate debtor in three tranches. The corporate debtor issued postdated cheques to discharge its liability, but the cheques were returned unpaid due to insufficient funds. The corporate debtor's account

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## Issues and analysis

### Issue 1: Whether the application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016, is …

**Ratio:** Section 7 of the IBC allows a financial creditor to initiate CIRP against a corporate

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**Reasoning:** The NCLT considered the submissions of the financial creditor, the documents filed, and

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**Interpretation:** Section 7 provides a mechanism for financial creditors to recover their dues by

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**Application:** The NCLT found that IREDA, being a financial creditor, had established a

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## Parties

- **Judges:** Rajeswara Rao…; Ashok Kumar…
- **Appellants:** M/s. Indian…
- **Respondents:** M/s. Noble Ispat…

## Timeline

- **1987-03-11 — Incorporation…**: Indian Renewable Energy Development Agency Limited (IREDA) was incorporated under the…
- **1999-07-02 — Incorporation of Noble…**: Noble Ispat & Energies Limited was…

## 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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