# In the matter of Riga Sugar Co. Ltd. CP (IB) No. 68-KB-2021

> NCLT judgment dated 2021-10-08. Citation: TCN-2021-NCLT-00772. Anit Finvest Private Limited filed a petition under Section 7 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 8 Oct 2021
- **Citation:** TCN-2021-NCLT-00772
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/riga-sugar-co-ltd-cp-ib-no-68-kb-2021-9a7ed706

## Summary

### Background

Anit Finvest Private Limited filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Riga Sugar Co Ltd, the Corporate Debtor. The Financial Creditor sought to recover a loan of ₹1,70,00,000/- sanctioned to the Corporate Debtor, which the Corporate Debtor defaulted on. The petition was initially delayed due to defects, which were later rectified. The Corporate Debtor argued against the petition, claiming it was an arm-twisting tactic and time-barred.

## Facts

Anit Finvest Private Limited (Financial Creditor) filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Riga Sugar Co Ltd (Corporate Debtor). The Financial Creditor sanctioned a loan of ₹1,70,00,000 to the Corporate Debtor on 15.06.2015, with interest at 12% per annum. The Corporate Debtor defaulted on interest payments starting in January 2018. The Financial Creditor sent a recall letter on 10.07.2018, demanding repayment of the principal and outstanding interest. The Corporate Debtor requested more time, but the Financial Creditor issued a demand notice on 31.08.2018. The Corporate Debtor argued that the petition was an arm-twisting tactic, time-barred, and that it was facing

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## Issues and analysis

### Issue 1: Whether the petition filed by the Financial Creditor under Section 7 of the Insolvency and …

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

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**Reasoning:** The court found that the Financial Creditor had provided sufficient evidence of the debt

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**Interpretation:** Section 7 provides a mechanism for financial creditors to recover debts from

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**Application:** The court applied Section 7 to the facts of the case, finding that the

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## Parties

- **Judges:** Rajasekha…; Satya Ranjan…
- **Appellants:** Anit Finvest…
- **Respondents:** Riga Sugar…

## Timeline

- **2015-03-17 — Board Reso…**: The board of the Corporate Debtor resolved to apply for a loan of ₹1,70,00,000 from the…
- **2015-04-03 — Loan Req…**: The Corporate Debtor requested the Financial Creditor to sanction the loan amount for…

## 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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