# In the matter of Meeti Developers Private Limited

> NCLT judgment dated 2024-04-05. Citation: TCN-2024-NCLT-01807. Edelweiss Asset Reconstruction Co. Limited, as the Financial Creditor, filed a petition under…

- **Court:** NCLT
- **Order date:** 5 Apr 2024
- **Citation:** TCN-2024-NCLT-01807
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/meeti-developers-private-limited-d4a38dc1

## Summary

### Background

Edelweiss Asset Reconstruction Co. Limited, as the Financial Creditor, filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Meeti Developers Private Limited, the Corporate Debtor, for an unresolved financial debt of Rs. 179,12,69,934/-. The debt arose from Non-Convertible Debentures (NCDs) subscribed by ECI Finance Limited (Original Lender) and later assigned to Edelweiss. The Corporate Debtor defaulted on repayment, leading to the initiation of Corporate Insolvency Resolution Process (CIRP). A prior CIRP initiated by the Applicant (CP 783 of 2020) was withdrawn based on a settlement agreement with Ajmera Realty & Infrastructure India Limited (ARIIL), which was to purchase the NCDs. However, ARIIL failed to fulfill the payment

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## Facts

ECI Finance Limited, as the Original Lender, subscribed to Non-Convertible Debentures (NCDs) on October 14, 2016. On October 29, 2016, a shareholders meeting authorized borrowing up to Rs.100 Crores under Section 180(1)(c) of the Companies Act, 2013, and approved the issuance of secured, redeemable, non-convertible debentures amounting to Rs.55 Crores. A Debenture Trustee Agreement was signed between the Corporate Debtor and Catalyst Trusteeship Limited. An Escrow Agreement was executed involving HDFC Bank Ltd. Subsequently, Rs.55 Crores was disbursed through the issuance of 1100 non-convertible debentures. Meeti Developers Pvt. Ltd. executed a Debenture Trust cum Mortgage deed with a 17% interest rate. Agreements regarding the pledge of shares and guarantees were made

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## Issues and analysis

### Issue 1: Whether the withdrawal of a previous CIRP application and a subsequent transfer agreement with a …

**Ratio:** The withdrawal of a previous CIRP application based on a settlement agreement does not

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**Reasoning:** The Tribunal reasoned that the Transfer Agreement explicitly stated that the transfer of

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**Interpretation:** The legal issue revolves around the interpretation of the effect of a

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**Application:** In this case, the Transfer Agreement with ARIIL did not absolve the Corporate

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## Parties

- **Judges:** Reeta K…; Madhu S…
- **Appellants:** Edelweiss Asset…
- **Respondents:** Meeti Developers…

## Timeline

- **2016-10-14 — Original Lender…**: ECI Finance Limited, as the Original Lender, subscribed to Non-Convertible Debentures…
- **2016-10-29 — Shareholders…**: A shareholders meeting authorized borrowing up to Rs.100 Crores and approved the issuance…

## 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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