# In the matter of Nashik Forge Private Limited IA-725-2023 IN IA-3709 & 3710-2022 in CP-IB-469-(MB)-2021

> NCLT judgment dated 2023-04-28. Citation: TCN-2023-NCLT-03554. The case involves a Company Petition filed under Section 10 of the Insolvency & Bankruptcy…

- **Court:** NCLT
- **Order date:** 28 Apr 2023
- **Citation:** TCN-2023-NCLT-03554
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/nashik-forge-private-limited-ia-725-2023-in-ia-3709-3710-2022-in-cp-ib-469-mb-20-6d8cc17e

## Summary

### Background

The case involves a Company Petition filed under Section 10 of the Insolvency & Bankruptcy Code, 2016, by Nashik Forge Private Limited ("Corporate Debtor") seeking initiation of Corporate Insolvency Resolution Process (CIRP). The company petition was filed on 03.02.2021, and the credit facility with State Bank of India was classified as NPA on 31.08.2019. The Corporate Debtor was incorporated on 26th May 2005. The Corporate Debtor had availed loan facility from the State Bank of Bikaner & Jaipur [later merged into State Bank of India (SBI)] for an aggregate amount of Rs.3,37,00,000/- on 03.03.2009. The loan facility was enhanced and modified, with the last sanction for total limits of Rs.8,98,00,000/- on 09.04.2019. Due to economic turnover and

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## Facts

Nashik Forge Private Limited (Corporate Debtor) filed a petition under Section 10 of the Insolvency & Bankruptcy Code, 2016, seeking initiation of Corporate Insolvency Resolution Process (CIRP). The company was incorporated on May 26, 2005. The company availed a loan facility from State Bank of Bikaner & Jaipur (later merged with SBI) for Rs. 3,37,00,000 on March 3, 2009. The loan facility was enhanced to Rs. 8,98,00,000 on April 9, 2019. Due to economic downturn and negative effects in the automobile industry, the company defaulted on loan repayments and was declared a Non-Performing Asset (NPA) on August 31, 2019. As of December 2, 2019, the total outstanding amount to SBI was Rs. 8,99,49,996. SBI issued a notice on December 2, 2019, for the outstanding

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## Issues and analysis

### Issue 1: Whether the petition filed by Nashik Forge Private Limited under Section 10 of the IBC for …

**Ratio:** Section 10 of the IBC allows a corporate debtor to initiate CIRP if it has committed a

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**Reasoning:** The court found that the Corporate Debtor had enclosed the required information relating

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**Interpretation:** Section 10 of the IBC provides a mechanism for a corporate debtor to initiate

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**Application:** The court applied the provisions of Section 10 of the IBC to the facts of the

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## Parties

- **Judges:** Prabhat…; KISHORE VEMULAPALL…
- **Respondents:** Nashik Forge…

## Timeline

- **2005-05-26 — Incorporation of…**: Nashik Forge Private…
- **2009-03-03 — Loan Facility…**: Corporate Debtor availed loan facility from State Bank of Bikaner & Jaipur (later merged…

## 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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