# In the matter of Kaved Realty Private Limited

> NCLT judgment dated 23 Oct 2024. Citation: TCN-2024-NCLT-00371. The Financial Creditor, Unity Small Finance Bank Limited, filed a company petition under…

- **Court:** NCLT
- **Order date:** 23 Oct 2024
- **Citation:** TCN-2024-NCLT-00371
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/ts-party-kaved-realty-private-limited-0500b909

## Summary

### Background

The Financial Creditor, Unity Small Finance Bank Limited, filed a company petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Kaved Realty Private Limited, the Corporate Debtor, for defaulting on a credit facility for which the Corporate Debtor acted as a guarantor.

## Facts

Unity Small Finance Bank Limited, the Financial Creditor, filed a Company Petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against Kaved Realty Private Limited, the Corporate Debtor. This action was taken because the Corporate Debtor, as a guarantor for Asuti Trading Private Limited (Borrower), defaulted on a credit facility originally provided by Punjab and Maharashtra Cooperative Bank (PMC Bank), which later merged with Unity Small Finance Bank Limited.

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor committed a…

**Ratio:** The Corporate Debtor owed a financial debt to the Financial Creditor, and a default in…

**Reasoning:** The Corporate Debtor, as a guarantor, failed to repay the amount due under the Letter of…

**Interpretation:** The execution of a Letter of Guarantee and the subsequent failure to repay the…

**Application:** The Corporate Debtor's failure to make repayment on January 27, 2020, and…

## Parties

- **Judges:** Prabhat…; V.G. B…
- **Respondents:** Kaved Realty…
- **Other parties:** Unity Small…; Punjab and…; +3 more
- **Advocates:** Naveli Resh…; Janhavi Mi…

## Timeline

- **September 22, 2017 — Letter of Guarantee…**: The Corporate Debtor executed a Letter of Guarantee for a credit facility provided by PMC…
- **July 8, 2019 — Letter of Credi…**: An irrevocable Letter of Credit (LC) was availed by the Borrower, Asuti Trading Private…

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