# In the matter of OCL Iron and Steel Limited CP (IB) No. 111-CTB-2020

> NCLT judgment dated 2021-09-20. Citation: TCN-2021-NCLT-01071. The case pertains to an application filed by Indian Bank (erstwhile Allahabad Bank) under…

- **Court:** NCLT
- **Order date:** 20 Sept 2021
- **Citation:** TCN-2021-NCLT-01071
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/ocl-iron-and-steel-limited-cp-ib-no-111-ctb-2020-b9df7fb8

## Summary

### Background

The case pertains to an application filed by Indian Bank (erstwhile Allahabad Bank) under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking initiation of Corporate Insolvency Resolution Process (CIRP) against OCL Iron and Steel Limited. The application was filed due to the corporate debtor's default in repayment of a term loan. The financial creditor claimed a default amount of ₹190,05,58,508/- as of 06.03.2020, including principal and interest.

## Facts

Indian Bank (erstwhile Allahabad Bank) filed an application under Section 7 of the Insolvency & Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against OCL Iron and Steel Limited. The financial creditor sought to recover a debt of ₹190,05,58,508/- including principal and interest as of 06.03.2020. The corporate debtor had approached the financial creditor for a loan of ₹200 Crore for manufacturing steel items and generating power. The loan was sanctioned on 20.08.2010. The corporate debtor agreed to create securities, including an equitable mortgage of immovable properties and hypothecation of movable assets. The corporate debtor executed a promissory note and a term loan agreement on 20.09.2010. The term loan was reviewed and

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## Issues and analysis

### Issue 1: Whether the application filed by Indian Bank under Section 7 of the Insolvency and Bankruptcy Code, …

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

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**Reasoning:** The court considered the pleadings and annexures filed by both parties. The court noted

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

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**Application:** The court found that the financial creditor had established a default by the

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## Parties

- **Judges:** Rajasekha…; Satya Ranjan…
- **Appellants:** Indian…
- **Respondents:** OCL Iron and…

## Timeline

- **2010-08-20 — Loan San…**: Loan of ₹200 Crore…
- **2010-09-20 — Promissory Note and…**: Corporate Debtor executed a…

## 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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