# In the matter of Raninga Ispat Pvt. Ltd. C.P.  (I.B) No. 200-7-NCLT-AHM-2017

> NCLT judgment dated 2018-02-21. Citation: TCN-2018-NCLT-01791. Kotak Resources filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016,…

- **Court:** NCLT
- **Order date:** 21 Feb 2018
- **Citation:** TCN-2018-NCLT-01791
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/raninga-ispat-pvt-ltd-cp-ib-no-200-7-nclt-ahm-2017-f00137d4

## Summary

### Background

Kotak Resources filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Raninga Ispat Private Limited, styling itself as a corporate debtor. Kotak Resources claimed to be a financial creditor, asserting that Raninga Ispat defaulted on a loan and commission payments. The petition was based on a loan agreement where Navis Multitrade Private Limited lent money to Raninga Ispat, with Kotak Resources later claiming rights to the debt through an assignment deed. The respondent, Raninga Ispat, contested the petition, arguing that Kotak Resources was not a financial creditor, the debt was not a financial debt, and the assignment deed was invalid.

## Facts

Kotak Resources, claiming to be a financial creditor, filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Raninga Ispat Private Limited. The petition was based on a loan agreement where Navis Multitrade Private Limited lent Rs. 1.00 crore to Raninga Ispat. Kotak Resources claimed rights to the debt through an assignment deed dated 25.10.2017. The terms of the agreement included a commission of Rs. 0.50 per kg of pig iron manufactured by Raninga Ispat, with a guaranteed production of 80 tonnes per day. Raninga Ispat allegedly defaulted on both the loan repayment and commission payments, leading to an outstanding amount of Rs. 8,30,00,000/- along with 18% interest per annum.

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## Issues and analysis

### Issue 1: Whether Kotak Resources is a financial creditor as defined under the Insolvency and Bankruptcy …

**Ratio:** A financial creditor is defined under the IBC as a person to whom a financial debt is

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**Reasoning:** The court reasoned that the agreement referred to Kotak Resources and Navis Multitrade

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**Interpretation:** The interpretation of 'financial creditor' hinges on the existence of a

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**Application:** The court applied this principle to the facts, noting that the agreement and

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## Parties

- **Judges:** BIKKI RAVEENDRA…; Manorama…
- **Appellants:** The Kotak…
- **Respondents:** Raninga Ispat…; Raninga Ispat Pvt…

## Timeline

- **2012-09-05 — Pledge Agreem…**: Pledge Agreement between petitioner, Navis…
- **2016-11-01 — Navis Multitrade Struck…**: Navis Multitrade Private 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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