# In the matter of Airen Metals Private Limited CP No. (IB)- 35-7-JPR-2021

> NCLT judgment dated 2022-04-28. Citation: TCN-2022-NCLT-02978. Kedia Financial Services Private Limited, a Non-Banking Finance Company, filed an application…

- **Court:** NCLT
- **Order date:** 28 Apr 2022
- **Citation:** TCN-2022-NCLT-02978
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/airen-metals-private-limited-cp-no-ib-35-7-jpr-2021-3404f9f2

## Summary

### Background

Kedia Financial Services Private Limited, a Non-Banking Finance Company, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking initiation of Corporate Insolvency Resolution Process (CIRP) against Airen Metals Private Limited, the Corporate Debtor. The Corporate Debtor had approached the Financial Creditor in 2012 for a loan to meet working capital requirements. The Financial Creditor disbursed a loan of Rs. 3,25,00,000 in 2013 and an additional loan of Rs. 67,00,000 in 2016. The Corporate Debtor failed to repay the loan amount by 31.03.2021, leading to the application for CIRP.

## Facts

In 2012, Airen Metals Private Limited (Corporate Debtor) approached Kedia Financial Services Private Limited (Financial Creditor) for a loan to meet incremental working capital requirements. The Financial Creditor disbursed Rs. 3,25,00,000 on 01.04.2013, as per the initial sanction letter, with an 8% per annum interest rate for the first financial year. An additional loan of Rs. 67,00,000 was disbursed on 27.12.2016, increasing the total repayable amount to Rs. 3,92,00,000, with the same interest rate terms. The Corporate Debtor paid interest until the financial year 2018-19 but failed to repay the entire loan amount by 31.03.2021, resulting in outstanding interest of Rs. 44,68,800. The Corporate Debtor acknowledged the outstanding dues on 13.09.2021, citing financial

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## Issues and analysis

### Issue 1: Whether the application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016 is …

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

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**Reasoning:** The Adjudicating Authority found that the Corporate Debtor had defaulted in the payment

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**Interpretation:** Section 7 provides a mechanism for financial creditors to recover their dues

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**Application:** The Adjudicating Authority applied Section 7 to the facts of the case, finding

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## Parties

- **Judges:** Deep Chandr…; RAGHU N…; +1 more
- **Appellants:** Kedia Financial…
- **Respondents:** Airen Metals…; Amol…

## Timeline

- **2012-01-01 — Loan Appli…**: Airen Metals Private Limited approached Kedia Financial Services Private Limited for a…
- **2013-04-01 — Initial Loan Disbursemen…**: Kedia Financial Services Private Limited disbursed Rs. 3,25,00,000 to Airen Metals…

## 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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