# In the matter of Holy Heights Infrastructures Pvt Ltd. CP (IB) No.43-ALD-2022

> NCLT judgment dated 2023-02-22. Citation: TCN-2023-NCLT-04492. The case involves an application filed under Section 7 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 22 Feb 2023
- **Citation:** TCN-2023-NCLT-04492
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/holy-heights-infrastructures-pvt-ltd-cp-ib-no43-ald-2022-67734696

## Summary

### Background

The case involves an application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016 by KV Foundations India Limited (Financial Creditor) against Holy Heights Infrastructures Pvt Ltd (Corporate Debtor) for default on a loan of ₹6,92,77,000. The Financial Creditor claims the Corporate Debtor failed to repay the loan despite repeated requests and a legal notice. The Corporate Debtor acknowledges the debt but disputes its validity, alleging it was a voluntary financial assistance routed through various entities by Sh. Ashok Kumar Gupta, connected to both parties. The Corporate Debtor also raised concerns about the loan agreement's genuineness, citing irregularities and lack of proper signatures and board resolutions.

## Facts

KV Foundations India Limited, a non-banking financial company, advanced a loan of ₹6,92,77,000 to Holy Heights Infrastructures Pvt Ltd for 12 months at 12% p.a. The loan agreement was executed on 2019-01-10, and the amount was disbursed between 2019-01-11 and 2019-01-23. No interest was charged until 2019-12-12, after which 12% interest was applicable. The Corporate Debtor acknowledged the debt in its balance sheets for 2019-20, 2020-21, and 2021-22. As of 2022-03-31, the outstanding amount was ₹9,12,56,747, including interest. A legal notice was served on 2022-04-11 demanding repayment. The Corporate Debtor, in its reply dated 2022-04-25, acknowledged the debt but refused to pay, claiming it was advanced by Sh. Ashok Kumar Gupta through various entities. The Corporate

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## Issues and analysis

### Issue 1: Whether there exists a valid financial debt …

**Ratio:** Section 5(8) of the IBC defines 'financial debt' as a debt along with interest, if any,

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**Reasoning:** The NCLT considered the loan agreement, the Corporate Debtor's balance sheets

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**Interpretation:** The interpretation of Section 5(8) requires the debt to be disbursed against

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**Application:** The NCLT applied the definition of financial debt to the facts, noting the loan

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## Parties

- **Judges:** Praveen…; Ashish…
- **Appellants:** K V FOUNDATIONS…
- **Respondents:** HOLY HEIGHTS…

## Timeline

- **2019-01-10 — Loan Agreement…**: Loan agreement executed between KV Foundations India Limited and Holy Heights…
- **2019-01-11 — Loan Disbursa…**: Disbursal of loan…

## 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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