# In the matter of Nirmangold Plasttech Private Limited

> NCLT judgment dated 2024-06-05. Citation: TCN-2024-NCLT-01222. Abhyudaya Cooperative Bank Limited, the Financial Creditor (FC), filed a Company Petition under…

- **Court:** NCLT
- **Order date:** 5 Jun 2024
- **Citation:** TCN-2024-NCLT-01222
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/nirmangold-plasttech-private-limited-a0fd7503

## Summary

### Background

Abhyudaya Cooperative Bank Limited, the Financial Creditor (FC), filed a Company Petition under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Nirmangold Plasttech Private Limited, the Corporate Debtor (CD). The FC claimed a default of Rs. 14,03,75,530.25/-, including principal, interest, and unapplied charges, based on loan and cash credit facilities sanctioned to the CD. The date of default was identified as 29.10.2019, when the CD's account was classified as Non-Performing Asset (NPA). The FC contended that the CD had not made any payments between 2013 and 2021 and did not respond to

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## Facts

Abhyudaya Cooperative Bank Limited (FC), a registered co-operative bank, filed a petition to initiate Corporate Insolvency Resolution Process (CIRP) against Nirmangold Plasttech Private Limited (CD), a private company engaged in manufacturing dish reflectors and automotive plastic parts. The FC claimed that the CD defaulted on loan and cash credit facilities. The total default amount was Rs. 14,03,75,530.25/-, including principal, interest, and unapplied charges. The date of default was 29.10.2019, when the CD's account was classified as Non-Performing Asset (NPA). The FC provided details of the sanctioned credit facilities, including term loans and cash credit limits, secured by hypothecation deeds and other documents. The CD acknowledged the term loans and cash

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## Issues and analysis

### Issue 1: Whether the Financial Creditor's application under Section 7 of the IBC for initiating CIRP against …

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

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**Reasoning:** The NCLT found that the Financial Creditor had successfully demonstrated and proved the

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**Interpretation:** Section 7 of the IBC provides a mechanism for financial creditors to recover

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**Application:** In this case, the Financial Creditor presented sufficient evidence to establish

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## Parties

- **Judges:** K. R. SAJI…; SANJIV…
- **Respondents:** Nirmangold…

## Timeline

- **2013-12-02 — Sanction…**: Term Loan of Rs. 8,43,48,000/- and Letter…
- **2016-06-03 — Sanction…**: Term Loan of Rs. 1,00,00,000/- and the Cash…

## 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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