# In the matter of India Circuits Limited

> NCLT judgment dated 2024-04-16. Citation: TCN-2024-NCLT-01710. Utsav Securities Private Limited, acting as the Financial Creditor, filed a petition under…

- **Court:** NCLT
- **Order date:** 16 Apr 2024
- **Citation:** TCN-2024-NCLT-01710
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/india-circuits-limited-6b66f76a

## Summary

### Background

Utsav Securities Private Limited, acting as the Financial Creditor, filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against India Circuits Limited, the Corporate Debtor, due to unpaid loans. The Financial Creditor claimed a default of Rs. 11,95,90,903/- along with interest. The Corporate Debtor contested the petition, arguing the absence of a formal financial contract and raising concerns about the legality of the loan transaction. Several applications (IAs) were filed, including one by India Circuits seeking directions for initiation of proceedings under Section 236 of the Code against Utsav Securities for alleged offenses and another by Utsav Securities seeking a preliminary

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## Facts

In February 2015, India Circuits Limited (Corporate Debtor) approached Utsav Securities Private Limited (Financial Creditor) for unsecured loans to meet business needs. Utsav Securities advanced Rs. 9,85,58,918 to India Circuits. India Circuits made partial interest payments of Rs. 2,83,723 on 31.03.2015 and Rs. 34,62,783 on 31.03.2016. The total interest overdue was Rs. 21,031,985. A demand notice was sent on 27.04.2019 for Rs. 11,95,90,903, but it was returned with the comment 'Address Ok But No Such Person'. The notice was also sent via email on 17.05.2019, but no response was received. The total amount claimed in default was Rs. 11,95,90,903 plus 9% compounded interest. India Circuits filed IA No. 1327/2022 seeking action against Utsav Securities for alleged

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## Issues and analysis

### Issue 1: Whether the present application …

**Ratio:** The time period for filing an application under Section 7 of the Code is governed by

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**Reasoning:** The court relied on the Hon'ble Principal Bench's clarification on the aspect of the date

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**Interpretation:** The Limitation Act, 1963, applies to proceedings under the Code, 2016, and the

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**Application:** The present petition was filed within the period of limitation of three years,

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## Parties

- **Judges:** Harnam Singh…; SUBRATA KUM…
- **Appellants:** Utsav Securities…
- **Respondents:** India Circuits…
- **Advocates:** Anand Chh…; Swati Vas…; +4 more

## Timeline

- **2015-02-01 — Loan Appli…**: India Circuits Limited approached Utsav…
- **2015-03-31 — Partial Interes…**: India Circuits paid Rs. 2,83,723…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 75 — Punishment for false information furnished in…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-75)

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