# In the matter of Mid-City Superstructures Private Limited

> NCLT judgment dated 2024-04-19. Citation: TCN-2024-NCLT-01664. The case pertains to an application filed under Section 7 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 19 Apr 2024
- **Citation:** TCN-2024-NCLT-01664
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/mid-city-superstructures-private-limited-04f9ac6c

## Summary

### Background

The case pertains to an application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) by Assets Care and Reconstruction Enterprise Limited (formerly Altico Capital India Limited) against Mid-City Superstructures Private Limited, the Corporate Debtor (CD), for initiating the Corporate Insolvency Resolution Process (CIRP). The application was originally filed by Altico Capital India Limited on 2019-11-25. Subsequently, Altico Capital India Limited assigned the loan assets to Assets Care and Reconstruction Enterprise Limited. The application seeks to recover a default amount of Rs. 257,52,97,623/- as of 2019-11-15.

## Facts

Altico Capital India Limited (now Assets Care and Reconstruction Enterprise Limited) extended loan facilities to Orbit Venture Developers, with Mid-City Superstructures Private Limited (the Corporate Debtor) acting as a guarantor. Two facility agreements were executed, one on 2016-06-30 and another on 2018-10-12, totaling Rs. 265,00,00,000/- and Rs. 95,00,00,000/- respectively. These loans were secured by various agreements, including Deeds of Guarantee and Share Pledge Agreements. The total debt disbursed was Rs. 3,45,00,00,000/- between 2016-03-31 and 2019-03-26. The Financial Creditor (FC) claimed a default of Rs. 257,52,97,623/- as of 2019-11-15, including principal, interest, and pending TDS. The FC issued an Acceleration and Enforcement Notice on 2019-10-11 and a

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## Issues and analysis

### Issue 1: Whether the application under Section 7 of the Insolvency and Bankruptcy Code, 2016 is maintainable …

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

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**Reasoning:** The Tribunal relied on the Supreme Court's judgment in Laxmi Pat Surana Vs. Union Bank of

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**Interpretation:** This interpretation clarifies that Section 7 can be invoked against a corporate

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**Application:** The Corporate Debtor (CD) acted as a guarantor for the loans extended to Orbit

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## Parties

- **Judges:** K. R. SAJI…; SANJIV…
- **Appellants:** Assets Care and…; Assets Care &…
- **Respondents:** Mid-City Superstru…
- **Advocates:** Rohit G…; Huzan Bhu…; +1 more

## Timeline

- **2016-03-30 — Facility Agre…**: Execution of Facility Agreement 1 between Orbit Ventures Developers, Mr. Rajen Dhruv, Mr.…
- **2016-06-30 — Facility Agree…**: Date of one of the facility agreements under…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 3(8) — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-3)

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