# In the matter of Enaar Steel & Alloy Pvt. Ltd. CP (IB) No. 39-10-HDB-2022

> NCLT judgment dated 2022-07-01. Citation: TCN-2022-NCLT-01939. The case involves an application filed by Enaar Steel & Alloy Private Limited under Section 10…

- **Court:** NCLT
- **Order date:** 1 Jul 2022
- **Citation:** TCN-2022-NCLT-01939
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/enaar-steel-alloy-pvt-ltd-cp-ib-no-39-10-hdb-2022-64f5e3fe

## Summary

### Background

The case involves an application filed by Enaar Steel & Alloy Private Limited under Section 10 of the Insolvency and Bankruptcy Code (IBC), 2016, seeking initiation of Corporate Insolvency Resolution Process (CIRP). The corporate applicant claims to have defaulted on a debt of Rs. 15,25,46,280/- owed to Southern Power Distribution Company of Telangana Limited (TSSPDCL). The corporate applicant has submitted financial statements for the preceding two years and a provisional balance sheet for the current year. The corporate applicant has also proposed the name of Mr. Pavan Kankani as Interim Resolution Professional (IRP). The shareholders of the corporate applicant passed a special resolution on 01.11.2021 for initiating CIRP.

## Facts

Enaar Steel & Alloy Private Limited filed an application under Section 10 of the IBC, 2016, seeking initiation of CIRP, claiming a default of Rs. 15,25,46,280/- to Southern Power Distribution Company of Telangana Limited (TSSPDCL). The corporate applicant submitted financial statements showing losses and liabilities. The shareholders passed a special resolution for initiating CIRP and proposed Mr. Pavan Kankani as IRP. TSSPDCL, the operational creditor, filed an affidavit conveying no objection to the CIRP. TSSPDCL submitted that the corporate applicant applied for electricity service connection in 1987 and subsequently enhanced the load. The service was disconnected in 2013 due to non-payment of dues. Form-A and B notices were issued under the Andhra Pradesh State

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## Issues and analysis

### Issue 1: Whether the Corporate Applicant is able to prove that it is unable pay the Debt claimed in the …

**Ratio:** Section 10 of the IBC, 2016 allows a corporate applicant to initiate CIRP if it has

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**Reasoning:** The Adjudicating Authority considered the financial statements of the Corporate

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**Interpretation:** The provision allows for initiation of CIRP when a corporate entity faces

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**Application:** In this case, the Corporate Applicant's financial statements demonstrated its

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## Parties

- **Judges:** Venkata Ramakrishn…; Veera Brahma Rao…
- **Respondents:** Enaar Steel &…; Southern Power…

## Timeline

- **1987-02-25 — HT Agreement C…**: The Corporate Applicant concluded the HT…
- **1987-03-31 — Service Connection…**: The Andhra Pradesh State Electricity Board released the service connection to the…

## 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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