# In the matter of Global Infratech & Finance Limited Company Petition No. 358-(IB)-MB-V-2021

> NCLT judgment dated 2022-11-25. Citation: TCN-2022-NCLT-00325. The case involves a petition filed by M/s Nirnidhi Consultant Private Limited (Financial…

- **Court:** NCLT
- **Order date:** 25 Nov 2022
- **Citation:** TCN-2022-NCLT-00325
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/global-infratech-finance-limited-company-petition-no-358-ib-mb-v-2021-9d495b5d

## Summary

### Background

The case involves a petition filed by M/s Nirnidhi Consultant Private Limited (Financial Creditor) under Section 7 of the Insolvency and Bankruptcy Code, 2016, against M/s Global Infratech & Finance Limited (Corporate Debtor) for resolution of an unresolved financial debt. The Financial Creditor claimed a debt of Rs. 1,22,18,042/- inclusive of interest till 30.11.2020. The Corporate Debtor acknowledged the debt but cited inability to repay due to the COVID-19 pandemic.

## Facts

A loan Memorandum of Understanding was executed on 01.10.2019 between M/s Nirnidhi Consultant Private Limited (Financial Creditor) and M/s Global Infratech & Finance Limited (Corporate Debtor), where the Financial Creditor advanced an Inter Corporate Loan of Rs.71,40,000/- at 12% per annum against lien of equity shares. The loan was to be repaid on or before 31.12.2019, with a penal interest of 1% per month in case of default. On 01.10.2019, the Financial Creditor sold equity shares of Rs. 34,00,000/- to the Respondent, which was to be repaid within 7 days, but the Respondent failed to make the payment. The Financial Creditor sent a letter dated 20.03.2020 demanding payment and converted the sale amount into a loan with 12% interest, which was acknowledged by the

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## Issues and analysis

### Issue 1: Whether the Petitioner has met the requirements for admission of a petition under Section 7 of the …

**Ratio:** The essential qualifications for admission of a petition under Section 7 of the I&B

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**Reasoning:** The court found that the Corporate Debtor acknowledged the debt and failed to repay it,

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**Interpretation:** Section 7 of the I&B Code allows a financial creditor to initiate CIRP

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**Application:** The court applied the ratio to the facts, noting that the Corporate Debtor's

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## Parties

- **Judges:** H.V. Subb…; ANURADHA SANJAY…
- **Appellants:** M/s Nirnidhi…
- **Respondents:** M/s Global…

## Timeline

- **2019-10-01 — Loan Memorandum of…**: Loan Memorandum of Understanding executed between Financial Creditor and Corporate Debtor…
- **2019-10-01 — Sale of Equit…**: Financial Creditor sold equity shares of Rs. 34,00,000/- to the Respondent, to be repaid…

## 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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