# In the matter of Cure Healthcare Private Limited IA-326(CHE)-2021 in CP(IB)-1325-2019

> NCLT judgment dated 2022-06-27. Citation: TCN-2022-NCLT-02019. The Resolution Professional of Cura Healthcare Private Ltd filed an application under Section…

- **Court:** NCLT
- **Order date:** 27 Jun 2022
- **Citation:** TCN-2022-NCLT-02019
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/cure-healthcare-private-limited-ia-326che-2021-in-cpib-1325-2019-a5fe8154

## Summary

### Background

The Resolution Professional of Cura Healthcare Private Ltd filed an application under Section 25 & 49 of the Insolvency and Bankruptcy Code, 2016, read with Rule 11 of NCLT Rules, 2016, seeking relief against the respondents. The application alleges fraudulent and wrongful trading by the respondents, including diversion of funds to subsidiaries, investments at exorbitant rates, and non-compliance with Companies Act provisions. The CIRP was initiated on 10.12.2019, and the applicant was appointed as Interim Resolution Professional and later re-appointed as Resolution Professional on 23.04.2020. A transaction audit was conducted, revealing transactions amounting to fraudulent trading under Section 66 of IBC, 2016.

## Facts

Cura Healthcare Private Limited (CHPL) underwent Corporate Insolvency Resolution Process (CIRP) initiated on 10.12.2019. Ms. Jayashree S Iyer, the Resolution Professional, filed an application alleging fraudulent transactions by the respondents. CHPL had availed a Cash Credit (CC) facility from State Bank of India on 20.11.2009. The transaction audit report revealed that CHPL diverted funds from this CC facility to its subsidiaries, IVES Healthcare (P) Ltd. (IVESHPL) and Adonis Medical Systems (P) Ltd. (AMSPL). CHPL invested Rs.6.04 Crore in these subsidiaries between April 2016 and March 2019. The audit also showed investments in IVESHPL and AMSPL through ledger vouchers dated 15.09.2016, 25.11.2016, 26.08.2016, and 20.10.2016. Share Purchase Agreements (SPA) between

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## Issues and analysis

### Issue 1: Whether the 1st to 11th Respondents have carried on business of the Corporate Debtor with an intent …

**Ratio:** Section 66 of the IBC, 2016, addresses fraudulent or wrongful trading. It allows the

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**Reasoning:** The Adjudicating Authority noted that the alleged fraudulent transactions occurred before

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**Interpretation:** Section 66 requires a demonstration that the directors or partners knew or

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**Application:** In this case, since the transactions occurred before the CIRP initiation, the

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## Parties

- **Judges:** (Retd.) S.…; Anil Ku…
- **Appellants:** Jayashree…
- **Respondents:** Cura Healthcare…; Deepak M…

## Timeline

- **2009-11-20 — Cash Credit Facility…**: Cura Healthcare Private Limited availed a Cash Credit (CC) Facility from State Bank of…
- **2014-04-04 — Loan Agreement with…**: The Corporate Debtor sanctioned a Short Term Loan / Inter Corporate Deposit of…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 49 — Transactions defrauding creditors](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-49)

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