# in the matter of Jhunsons Chemicals Private Limited

> NCLT judgment dated 2024-05-02. Citation: TCN-2024-NCLT-01480. The case involves an application filed under Section 7 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 2 May 2024
- **Citation:** TCN-2024-NCLT-01480
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/jhunsons-chemicals-private-limited-53a1558c

## Summary

### Background

The case involves an application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016, by Shilpi Cables Private Limited (Financial Creditor) against Jhunsons Chemicals Private Limited (Corporate Debtor) for an amount of Rs. 2,21,53,531/- as of 20.08.2019. Shilpi Cables Private Limited is already undergoing liquidation as a CIRP was initiated against them in IB 461/2017. The Adjudicating Authority allowed the Liquidator to initiate appropriate legal proceedings against the Corporate Debtor. The Corporate Debtor was incorporated under the Companies Act, 1956 on 07.09.1992 and is engaged in the business of Gamma Irradiation and Sterilization facility. The Applicant extended loan unsecured/inter corporate deposits forming part of long-term borrowings amounting

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## Facts

Shilpi Cables Private Limited (Financial Creditor) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Jhunsons Chemicals Private Limited (Corporate Debtor). The claim amount was Rs. 2,21,53,531/- as of 20.08.2019. Shilpi Cables Private Limited is itself undergoing liquidation. The Corporate Debtor was incorporated on 07.09.1992 and is in the business of Gamma Irradiation and Sterilization. The Financial Creditor extended unsecured loans/inter-corporate deposits totaling Rs. 1,57,00,000/- to the Corporate Debtor. The disbursal of the loan occurred between 17.09.2014 and 21.05.2015. The date of default was 16.10.2019, when the demand notice for repayment was issued. The

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## Issues and analysis

### Issue 1: Whether the requirements of 'Debt and Default' under the Insolvency and Bankruptcy Code, 2016, have …

**Ratio:** The existence of a financial debt and default is a prerequisite for admitting an

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**Reasoning:** The NCLT examined the balance sheets of the Corporate Debtor, which reflected the

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**Interpretation:** The court interpreted the provisions of Section 7 of the IBC and the definition

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**Application:** The NCLT found that the balance sheets of the Corporate Debtor and the demand

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## Parties

- **Judges:** Ramalingam…; AVINASH K.…
- **Appellants:** Shilpi Cables…
- **Respondents:** M/s Jhunsons…

## Timeline

- **1992-09-07 — Incorporation of…**: Jhunsons Chemicals Private Limited was…
- **2014-08-18 — Execution…**: The Applicant and SKD executed a Memorandum of Understanding (MOU) with the Respondent…

## 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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