# In the matter of Satyamitra Stock Consultants Private Limited CP No. (IB)-112-7-JPR-2019

> NCLT judgment dated 2019-08-09. Citation: TCN-2019-NCLT-01996. Findeal Investments Private Limited, claiming to be a Financial Creditor, filed an application…

- **Court:** NCLT
- **Order date:** 9 Aug 2019
- **Citation:** TCN-2019-NCLT-01996
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/satyamitra-stock-consultants-private-limited-cp-no-ib-112-7-jpr-2019-b2645c61

## Summary

### Background

Findeal Investments Private Limited, claiming to be a Financial Creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) against Satyamitra Stock Consultants Private Limited, the Corporate Debtor, for default in repayment of a loan amount. The Applicant sought initiation of the Corporate Insolvency Resolution Process (CIRP). The Corporate Debtor had availed an interest-free advance from the Applicant, which was later converted into a loan agreement with security. The Corporate Debtor admitted to the debt but faced financial difficulties due to losses incurred on the sale of equity shares.

## Facts

Findeal Investments Private Limited (the Applicant) claimed to be a Financial Creditor to Satyamitra Stock Consultants Private Limited (the Corporate Debtor). The Corporate Debtor availed an interest-free advance of Rs. 3,87,48,909/- from the Applicant until 31.03.2016, which was to be repaid on or after 01.04.2016. Due to the Corporate Debtor's failure to repay, a Loan Agreement with Security was entered on 01.04.2017, converting the advance into an interest-bearing loan for 12 months. The Corporate Debtor pledged 7,25,000 equity shares in Systematix Corporate Service Limited as security. The Corporate Debtor was required to repay the loan with 15% interest per annum, with an additional 2% charge on default. The Corporate Debtor made partial payments of Rs. 20,00,000

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## Issues and analysis

### Issue 1: Whether the application filed by the Financial Creditor under Section 7 of the IBC, 2016 is …

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

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**Reasoning:** The Tribunal observed that the Applicant, being a Financial Creditor, had filed the

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**Interpretation:** Section 7 of IBC provides the mechanism for financial creditors to trigger the

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**Application:** The Tribunal found that the Applicant had demonstrated the existence of a

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## Parties

- **Judges:** POONDLA BHASKARA…; RAGHU N…; +1 more
- **Appellants:** Findeal Investment…
- **Respondents:** Satyamitra Stock…

## Timeline

- **2016-03-31 — Interest-Free…**: Corporate Debtor availed interest-free advance…
- **2016-04-01 — Repaymen…**: Repayment of the interest-free…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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