# In the matter of Ankit Metal & Power Limited

> NCLT judgment dated 2023-12-20. Citation: TCN-2023-NCLT-00115. UCO Bank, the Financial Creditor, filed an application under Section 7 of the Insolvency and…

- **Court:** NCLT
- **Order date:** 20 Dec 2023
- **Citation:** TCN-2023-NCLT-00115
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/ankit-metal-power-limited-d461acaf

## Summary

### Background

UCO Bank, the Financial Creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Ankit Metal & Power Limited, the Corporate Debtor, seeking initiation of the Corporate Insolvency Resolution Process (CIRP). The Corporate Debtor had entered into an agreement with the Financial Creditor for a Working Capital Credit Facility of Rs. 65,00,00,000/- in 2010. The Corporate Debtor defaulted on interest payments starting 31.05.2014, and the account was classified as a Non-Performing Asset (NPA) on 28.08.2014. A Master Restructuring Agreement (MRA) was executed on 25.09.2014, but the restructuring failed. The Financial Creditor issued a notice under Section 13(2) of the SARFAESI Act on 07.04.2018. The Financial Creditor claimed an

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## Facts

UCO Bank, the Financial Creditor, extended a Working Capital Credit Facility of Rs. 65,00,00,000/- to Ankit Metal & Power Limited, the Corporate Debtor, on 10.12.2010. The Corporate Debtor defaulted on interest payments starting 31.05.2014, leading to the account being classified as NPA on 28.08.2014. A Master Restructuring Agreement (MRA) was executed on 25.09.2014, but it failed. The last payment received by the Financial Creditor was Rs. 2,49,157/- on 23.08.2018. The Financial Creditor issued a notice under Section 13(2) of the SARFAESI Act on 07.04.2018, claiming Rs. 105,45,00,000/-. The outstanding amount as of 16.08.2022 was Rs. 178,00,81,925/-. The Financial Creditor relied on the Corporate Debtor's balance sheet as of 31.03.2022, which acknowledged the

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## Issues and analysis

### Issue 1: Whether this application filed under Section 7 of the I&B Code could be considered when …

**Ratio:** The pendency of proceedings under the RDDBFI Act does not bar the filing of an

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**Reasoning:** The court reasoned that the proceedings before the DRT were for the recovery of debts,

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**Interpretation:** The I&B Code aims at resolution of corporate debtors, which is distinct

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**Application:** The court held that the proceedings initiated before the DRT for recovery of

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## Parties

- **Judges:** BIDISHA BA…; D. Ar…
- **Appellants:** UCO…
- **Respondents:** Ankit Metal and…; M/S ANKIT METAL…
- **Advocates:** Joy S…; Santosh Kum…; +5 more

## Timeline

- **2010-12-10 — Credit Facility…**: Corporate Debtor entered into an agreement with the Financial Creditor for a Working…
- **2014-05-31 — First De…**: The first default by the Corporate…

## 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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