# In the matter of Seya Industries Limited C.P.(IB)606-MB-2020

> NCLT judgment dated 2021-08-03. Citation: TCN-2021-NCLT-01499. This case involves a company petition filed by Beacon Trusteeship Limited, S C Manager Private…

- **Court:** NCLT
- **Order date:** 3 Aug 2021
- **Citation:** TCN-2021-NCLT-01499
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/seya-industries-limited-cpib606-mb-2020-72f9096c

## Summary

### Background

This case involves a company petition filed by Beacon Trusteeship Limited, S C Manager Private Limited, and SC Credit Fund against Seya Industries Limited, seeking to initiate the Corporate Insolvency Resolution Process (CIRP). The petitioners allege that Seya Industries Limited defaulted on a payment of Rs. 77,94,92,513/-. The Corporate Debtor had issued secured, unrated, redeemable, non-convertible debentures to Petitioner No. 3. Beacon Trusteeship Limited was appointed as the Debenture Trustee. The Corporate Debtor failed to pay the first coupon payment on 11.09.2019, even after a grace period was extended to 15.10.2019. The Petitioners issued notices calling for payment, but the Corporate Debtor failed to comply. The Corporate Debtor had also initiated arbitration

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## Facts

Beacon Trusteeship Limited, S C Manager Private Limited, and SC Credit Fund filed a company petition against Seya Industries Limited under Section 7 of the IBC, seeking to initiate CIRP due to a default of Rs. 77,94,92,513/-. Seya Industries Limited had issued secured, unrated, redeemable, non-convertible debentures, with SC Credit Fund being the debenture holder and Beacon Trusteeship Limited acting as the debenture trustee. SC Credit Fund disbursed Rs. 72 crores to Seya Industries Limited on 11.03.2019. Seya Industries Limited was obligated to pay the first coupon on 11.09.2019, but failed to do so, even after a grace period extending to 15.10.2019. This non-payment triggered an event of default under the Debenture Trust Deed. The Petitioners issued a recall notice

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## Issues and analysis

### Issue 1: Whether there is an existence of financial debt in terms of Debenture Trust Deed (DTD) and default …

**Ratio:** The legal principle applied is that a financial debt exists when money is disbursed

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**Reasoning:** The court reasoned that the undisputed fact that Rs. 72 crores was disbursed by

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**Interpretation:** The interpretation involves understanding the terms of the Debenture Trust

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**Application:** The ratio and reasoning were applied to the specific facts of the case, where

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## Parties

- **Judges:** SUCHITRAKAN…; Chandra Bha…
- **Appellants:** Beacon Trusteeship…
- **Respondents:** Seya Industries…

## Timeline

- **2019-03-08 — Debenture Trust Deed…**: Corporate Debtor issued secured, unrated,…
- **2019-03-11 — Disbursement…**: Petitioner No. 3 paid a sum of Rs.…

## 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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