# In the matter of Powerage Towers Limited CP(IB) 60-2018

> NCLT judgment dated 2022-05-05. Citation: TCN-2022-NCLT-02869. The case pertains to an application filed by Omkara Assets Reconstruction Private Limited…

- **Court:** NCLT
- **Order date:** 5 May 2022
- **Citation:** TCN-2022-NCLT-02869
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/powerage-towers-limited-cpib-60-2018-14aa6ad9

## Summary

### Background

The case pertains to an application filed by Omkara Assets Reconstruction Private Limited (initially filed by M/s L & T Finance Limited) under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against Powerage Towers Limited, the Corporate Debtor. The applicant claims a default amount of Rs. 3,02,76,344/- including interest, with the default date being 10.06.2016. The Corporate Debtor opposed the application, contending that the amount claimed is not a debt and citing a settlement agreement with L&T Limited.

## Facts

Omkara Assets Reconstruction Private Limited (originally L&T Finance Limited) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Powerage Towers Limited (Corporate Debtor). The claimed default amount is Rs. 3,02,76,344/- including interest, with a default date of 2016-06-10. The applicant had sanctioned two term loans and one vendor finance facility to the Corporate Debtor. The Corporate Debtor defaulted on these facilities. The Corporate Debtor opposed the application, arguing that the claimed amount is not a debt due to a settlement agreement with L&T Limited. The Corporate Debtor also submitted that the present application is not maintainable. The applicant

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## Issues and analysis

### Issue 1: Whether the application filed by Omkara Assets Reconstruction Private Limited under Section 7 of …

**Ratio:** Section 7 of the Insolvency and Bankruptcy Code, 2016, allows a financial creditor to

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**Reasoning:** The Adjudicating Authority found that the application was complete in terms of Section 7

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**Interpretation:** Section 7 provides the mechanism for a financial creditor to trigger the

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**Application:** The Adjudicating Authority determined that the application met the requirements

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## Parties

- **Judges:** Madan B.…; KAUSHALENDRA…
- **Appellants:** Omkara Assets…
- **Respondents:** Powerage Towers…; Powerage Towers…

## Timeline

- **2013-07-02 — Date of Sanction (Term…**: Date of sanction for the term…
- **2014-12-04 — Date of Sanction…**: Date of sanction for the vendor…

## 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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