# In the matter of Modern Syntex (India) Limited IA No. 256-JPR-2020 & IA No. 334-JPR-2021 in CP (IB) No. 39(PB)2018

> NCLT judgment dated 2022-03-28. Citation: TCN-2022-NCLT-03512. The case involves an application under Section 7 of the Insolvency and Bankruptcy Code, 2016,…

- **Court:** NCLT
- **Order date:** 28 Mar 2022
- **Citation:** TCN-2022-NCLT-03512
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/modern-syntex-india-limited-ia-no-256-jpr-2020-ia-no-334-jpr-2021-in-cp-ib-no-39-605f6e70

## Summary

### Background

The case involves an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, filed by the Administrator of Specified Undertaking of Unit Trust of India and UTI Trustee Company Private Limited (Financial Creditors) against M/s Modern Syntex (India) Limited (Corporate Debtor) for initiation of Corporate Insolvency Resolution Process (CIRP). The Corporate Debtor had received finance from the Financial Creditors in the form of Secured Redeemable Non-Convertible Debentures (NCD) and Unsecured Transferable Notes (UTNs). A restructuring package was approved in 1998, converting overdue interest and principal into Optionally Secured Fully Convertible Debentures (OFCDs) and NCDs. The Corporate Debtor was referred to the Board for Industrial and Financial

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## Facts

M/s Modern Syntex (India) Limited, the Corporate Debtor, received financial assistance from the Administrator of Specified Undertaking of Unit Trust of India and UTI Trustee Company Private Limited, the Financial Creditors, in the form of Secured Redeemable Non-Convertible Debentures (NCDs) and Unsecured Transferable Notes (UTNs). The total amount of NCDs was Rs. 5385 Lacs and UTNs was Rs. 700 Lacs. The allotment of NCDs occurred on various dates in 1995. Due to financial difficulties, the Corporate Debtor requested a restructuring package, which was approved on 09.09.1998. This package converted overdue interest and simple interest into 16% Optionally Secured Fully Convertible Debentures (OFCDs) and the outstanding principal of UTNs and NCDs into 17% NCDs. The

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## Issues and analysis

### Issue 1: Whether Ms. Anita Patole was duly authorized to depose on behalf of the applicants in the present …

**Ratio:** The authority to institute legal proceedings on behalf of a corporate entity must be

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**Reasoning:** The Adjudicating Authority considered the authority letters and resolutions filed by the

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**Interpretation:** The interpretation of the authorization documents and resolutions is crucial to

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**Application:** The Adjudicating Authority found that Ms. Anita Patole was duly authorized by

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## Parties

- **Judges:** Deep Chandr…; RAGHU N…; +1 more
- **Appellants:** Administrator of…
- **Respondents:** M/s Modern Syntex…

## Timeline

- **1995-09-24 — Allotment of…**: Allotment of 15% Non-Convertible…
- **1995-01-03 — Allotment of…**: Allotment of 17% Non-Convertible…

## 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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