# In the matter of Mahamay Building Solution Private Limited Company Petition No. (IB)-142-(ND)-2022

> NCLT judgment dated 2022-08-23. Citation: TCN-2022-NCLT-01302. The case involves an application filed by M/s Digital Compusystems Private Limited under…

- **Court:** NCLT
- **Order date:** 23 Aug 2022
- **Citation:** TCN-2022-NCLT-01302
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/mahamay-building-solution-private-limited-company-petition-no-ib-142-nd-2022-954e1180

## Summary

### Background

The case involves an application filed by M/s Digital Compusystems Private Limited under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against M/s. Mahamay Building Solution Private Limited, the corporate debtor, due to a default in payment of Rs. 3,66,84,383/-. The applicant, a financial creditor, claims that the corporate debtor failed to repay a loan amount disbursed under a Memorandum of Understanding (MoU) dated 15.04.2019.

## Facts

M/s Digital Compusystems Private Limited (the applicant) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against M/s. Mahamay Building Solution Private Limited (the corporate debtor). The applicant claimed that the corporate debtor defaulted in payment of Rs. 3,66,84,383/-. The applicant and the corporate debtor entered into a Memorandum of Understanding (MoU) dated 15.04.2019, under which the applicant provided construction finance to the corporate debtor. The loan facility amounted to Rs. 1,70,00,000/- disbursed in multiple tranches between 07.05.2019 and 26.07.2019. Clause 4 of the MoU stipulated that the loan amount was to be repaid within two years from the date of first

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## Issues and analysis

### Issue 1: Whether the application under Section 7 of the …

**Ratio:** An application under Section 7 of the Code is maintainable if the debt is proved to be

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**Reasoning:** The court observed that the applicant had placed material on record, including the MoU,

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**Interpretation:** Section 7 of the IBC allows a financial creditor to initiate CIRP against a

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**Application:** In this case, the applicant provided sufficient evidence to prove the existence

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## Parties

- **Judges:** DHARMINDER…; BINOD KUMAR…
- **Appellants:** M/s Digital…
- **Respondents:** Mahamay Building…

## Timeline

- **2019-04-15 — MoU Exec…**: Memorandum of Understanding (MoU) executed…
- **2019-05-07 — First Disbu…**: First disbursement of the loan amount by…

## 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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