# In the matter of Honey Builders Limited

> NCLT judgment dated 2025-03-18. Citation: TCN-2025-NCLT-00344. The case involves a petition filed by Standard Capital Markets Ltd. (the Applicant/Financial…

- **Court:** NCLT
- **Order date:** 18 Mar 2025
- **Citation:** TCN-2025-NCLT-00344
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/honey-builders-limited-19f0d05c

## Summary

### Background

The case involves a petition filed by Standard Capital Markets Ltd. (the Applicant/Financial Creditor) under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking initiation of the Corporate Insolvency Resolution Process (CIRP) against Honey Builders Ltd. (the Respondent/Corporate Debtor). The petition stems from a financial debt owed by Honey Builders Ltd. to Standard Capital Markets Ltd. Veer Chemicals Pvt. Ltd. initially sought loan facilities from Sammaan Capital Ltd. (SCL), which later assigned its rights to Standard Capital Markets Ltd. The loan was for construction activities and building residential projects. A loan agreement was entered into between SCL and Veer for Rs. 150,00,00,000/- dated 30.10.2018. Honey Builders Ltd. acted as a guarantor for the

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## Facts

1. Veer Chemicals Pvt. Ltd. sought loan facilities from Sammaan Capital Ltd. (SCL) for construction activities.
2. SCL issued a letter sanctioning financial facility to Veer.
3. SCL and Veer entered into a Loan Agreement for Rs. 150,00,00,000/- dated 30.10.2018.
4. SCL disbursed Rs. 150,00,00,000/- to Veer on 02.11.2018.
5. Honey Builders Ltd. and other sister concerns executed a Memorandum of Entry on 28.11.2020, creating a first-ranking mortgage in favor of SCL.
6. A Deed of Hypothecation was executed in favor of SCL, creating a first-ranking charge over receivables from the Security Lands.
7. On 01.10.2020, SCL and Veer executed an Addendum Agreement extending the Loan Agreement term to 05.10.2025.
8. On 01.10.2024, SCL executed a Deed of Assignment in favor of Standard

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## Issues and analysis

### Issue 1: Whether a 'default' as defined under …

**Ratio:** Section 3(12) of the IBC defines 'default' as non-payment of debt when the whole or any

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**Reasoning:** The court relied on the definition of 'default' under Section 3(12) of the IBC and found

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**Interpretation:** The definition of 'default' under Section 3(12) is interpreted strictly to mean

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**Application:** In this case, the court found that the non-payment of the EMI on 05.10.2024

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## Parties

- **Judges:** Sh. Ashok Kumar…; Charanjeet Singh…
- **Appellants:** Standard Capital…
- **Respondents:** Honey Builders…

## Timeline

- **2018-10-30 — Loan Agre…**: SCL and Veer entered into a Loan…
- **2018-11-02 — Disbursement…**: SCL disbursed Rs.…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 3(12) — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-3)

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