# In the matter of Ruchi Soya Industries Ltd. CP 1371 & CP 1372-I&BP-NCLT-MAH-2017

> NCLT judgment dated 2017-12-15. Citation: TCN-2017-NCLT-00042. The case involves two company petitions (CP 1371/2017 and CP 1372/2017) filed under Section 7…

- **Court:** NCLT
- **Order date:** 15 Dec 2017
- **Citation:** TCN-2017-NCLT-00042
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/ruchi-soya-industries-ltd-cp-1371-cp-1372-ibp-nclt-mah-2017-db513f5b

## Summary

### Background

The case involves two company petitions (CP 1371/2017 and CP 1372/2017) filed under Section 7 of the Insolvency & Bankruptcy Code, 2016 (IBC) by Standard Chartered Bank and DBS Bank Ltd, respectively, against Ruchi Soya Industries Ltd. The petitions seek to initiate a Corporate Insolvency Resolution Process (CIRP) against Ruchi Soya due to defaults in repayment of loans. Standard Chartered Bank's petition relates to defaults in repayment of USD 5,358,742.84 and ₹334,14,19,044. DBS Bank's petition relates to defaults in repayment of USD 10,332,989.51 and USD 26,427,702.87. The Corporate Debtor raised objections to the initiation of CIRP, primarily concerning the validity of the Power of Attorney (POA) held by the Financial Creditors' representatives and procedural

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## Facts

Ruchi Soya Industries Ltd. defaulted on loan repayments to Standard Chartered Bank and DBS Bank Ltd. Standard Chartered Bank's claim includes USD 5,358,742.84 and ₹334,14,19,044 outstanding as of August 31, 2017, related to external borrowing and working capital facilities. DBS Bank's claim includes USD 10,332,989.51 and USD 26,427,702.87 outstanding as of July 31, 2017, related to External Commercial Borrowings (ECB-I and ECB-II). The loans were initially availed by Ruchi Infrastructure Ltd. but the liability was later transferred to Ruchi Soya. Ruchi Soya acknowledged the debt and default in communications with the banks and in its annual reports. The Corporate Debtor raised objections to the initiation of CIRP, challenging the validity of the Power of Attorney (POA)

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## Issues and analysis

### Issue 1: Whether the Power of Attorney given …

**Ratio:** The court relied on Section 25B of the Companies Act, Singapore, which states that in

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**Reasoning:** The court reasoned that the Power of Attorney was executed in Singapore and is governed

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**Interpretation:** The court interpreted the Companies Act of Singapore to mean that the directors

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**Application:** The court applied the ratio to the facts of the case, finding that the Power of

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## Parties

- **Judges:** B.S.V. Prakash…; V. Nallasen…
- **Appellants:** Standard Chartered…
- **Respondents:** Ruchi Soya…
- **Advocates:** Atul Rajyad…; Gaurav…; +9 more

## Timeline

- **2012-01-27 — ECB Facility A…**: ECB facility originally granted by the Creditor to Ruchi Infrastructure Ltd vide an…
- **2015-03-31 — Deed of No…**: A Deed of Novation dated 31.3.2015 was executed between the parties transferring ECB loan…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 2(a) — Application](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-2)

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