# In the matter of J H V SUGAR LIMITED

> NCLT judgment dated 2025-04-07. Citation: TCN-2025-NCLT-00233. The case involves a petition filed under Section 7 of the Insolvency and Bankruptcy Code, 2016,…

- **Court:** NCLT
- **Order date:** 7 Apr 2025
- **Citation:** TCN-2025-NCLT-00233
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/j-h-v-sugar-limited-093dd49b

## Summary

### Background

The case involves a petition filed under Section 7 of the Insolvency and Bankruptcy Code, 2016, by Indian Renewable Energy Development Agency Limited (the Financial Creditor) against J H V Sugar Limited (the Corporate Debtor) to initiate the Corporate Insolvency Resolution Process (CIRP). The Financial Creditor claims that the Corporate Debtor defaulted on a loan amounting to Rs. 24,95,05,121 as of March 31, 2023. The Corporate Debtor had approached the Financial Creditor in 2011 for a loan of Rs. 5710.50 lakh, which was sanctioned. A loan agreement and Deed of Hypothecation were executed. The Corporate Debtor failed to repay the loan, leading to the account being classified as a Non-Performing Asset. A One Time Settlement (OTS) was attempted but failed, leading to the

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## Facts

In 2011, J H V Sugar Limited (Corporate Debtor) sought a loan of Rs. 5710.50 lakh from Indian Renewable Energy Development Agency Limited (Financial Creditor), comprising Rs. 2741.25 lakh as a main loan and Rs. 2969 lakh as an additional/bridge loan for the Sugar Development Fund. The loan was sanctioned on July 26, 2011. A loan agreement and Deed of Hypothecation were executed on October 3, 2022. The Corporate Debtor was to repay the loan in quarterly installments with interest at 12.50% for the term loan and 13.50% for the additional/bridge loan. The Corporate Debtor failed to repay the debt, leading the Financial Creditor to issue a Demand Notice on December 16, 2015. The account was classified as a Non-Performing Asset on March 31, 2017. A Loan Recall notice was

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## Issues and analysis

### Issue 1: Whether the application filed by the Financial Creditor under Section 7 of the Insolvency and …

**Ratio:** Section 7 of the Insolvency and Bankruptcy Code, 2016 allows a financial creditor to

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**Reasoning:** The court found that the Financial Creditor had submitted sufficient evidence, including

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**Interpretation:** Section 7 provides a mechanism for financial creditors to recover their dues by

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**Application:** The court applied Section 7 and Rule 4(1) to the facts of the case, noting that

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## Parties

- **Judges:** BIDISHA BA…; SAMEER…
- **Respondents:** J.H.V. Sugar…

## Timeline

- **2011-01-01 — Loan Appli…**: The Corporate Debtor approached the Financial…
- **2011-07-26 — Loan San…**: The Financial Creditor sanctioned…

## 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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