# In the matter of Sujana Capital Services Limited CP(IB)No.700-7-HDB-2018

> NCLT judgment dated 2019-04-24. Citation: TCN-2019-NCLT-03735. The case involves a petition filed by Bhiragacha Finance Company Pvt. Ltd (Financial Creditor)…

- **Court:** NCLT
- **Order date:** 24 Apr 2019
- **Citation:** TCN-2019-NCLT-03735
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/sujana-capital-services-limited-cpibno700-7-hdb-2018-9f726403

## Summary

### Background

The case involves a petition filed by Bhiragacha Finance Company Pvt. Ltd (Financial Creditor) under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Sujana Capital Services Limited (Corporate Debtor). The Financial Creditor provided an Inter Corporate Deposit (ICD) loan to Sujana Towers Limited, a related company of the Corporate Debtor. Sujana Towers Limited failed to repay the loan. Subsequently, Sujana Capital Services Limited unconditionally undertook to take over the debts of Sujana Towers Limited. The Corporate Debtor also issued post-dated cheques, which were later returned. The Financial Creditor claimed that the Corporate Debtor made a last payment on July 6, 2017, and the petition is not barred by limitation.

## Facts

Bhiragacha Finance Company Pvt. Ltd (Financial Creditor) filed a petition against Sujana Capital Services Limited (Corporate Debtor) under Section 7 of the Insolvency and Bankruptcy Code, 2016. The Financial Creditor had extended an Inter Corporate Deposit (ICD) loan of Rs. 1,50,00,000/- to Sujana Towers Limited, a related company of the Corporate Debtor, on August 26, 2010, for 120 days at 15% interest per annum, later renewed at 16%. Sujana Towers Limited failed to repay the loan. On March 1, 2013, Sujana Capital Services Limited unconditionally undertook to take over the debts of Sujana Towers Limited, including interest from October 1, 2012. The Corporate Debtor issued three post-dated cheques, which were dishonored. The Financial Creditor claimed that the

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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 Adjudicating Authority considered the documentary evidence presented by the Financial

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

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**Application:** The Adjudicating Authority found that the Financial Creditor had provided

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## Parties

- **Judges:** K. Anantha…
- **Appellants:** M/s. Bhiragacha…
- **Respondents:** M/s. Sujana…

## Timeline

- **2010-08-26 — ICD Loan…**: Sujana Towers sought an inter-corporate deposit loan from Bhiragacha Finance Company Pvt.…
- **2010-12-27 — ICD Rene…**: ICD was renewed at an agreed…

## 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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