# In the matter of Rana Heavy Engineering Ltd. Rana Heavy Engineering Ltd. CP No. (IB) 50-ALD-2022

> NCLT judgment dated 2023-03-03. Citation: TCN-2023-NCLT-04361. The case originates from an application filed by Hadirah Steels Pvt Ltd, the Financial…

- **Court:** NCLT
- **Order date:** 3 Mar 2023
- **Citation:** TCN-2023-NCLT-04361
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/rana-heavy-engineering-ltd-rana-heavy-engineering-ltd-cp-no-ib-50-ald-2022-003e2ac2

## Summary

### Background

The case originates from an application filed by Hadirah Steels Pvt Ltd, the Financial Creditor, under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Rana Heavy Engineering Ltd, the Corporate Debtor. The Financial Creditor and Corporate Debtor entered into a loan facility agreement on 2021-10-11, where the Financial Creditor agreed to provide financial assistance up to Rs. 8,00,00,000/- as an unsecured loan. The Corporate Debtor defaulted on repayments, leading the Financial Creditor to issue a loan recall notice on 2022-04-15. As the Corporate Debtor failed to respond, the Financial Creditor filed an application under Section 7 of the Code.

## Facts

Hadirah Steels Pvt Ltd (Financial Creditor) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Rana Heavy Engineering Ltd (Corporate Debtor). A loan facility agreement was entered on 2021-10-11, where the Financial Creditor agreed to provide financial assistance up to Rs. 8,00,00,000/- as an unsecured loan. The Financial Creditor disbursed Rs. 3,15,45,000/- in eight tranches from 2021-11-30 to 2022-03-29. The Corporate Debtor defaulted on repayments, leading the Financial Creditor to issue a loan recall notice on 2022-04-15, requesting repayment of Rs. 3,15,45,000/- along with interest at 12% p.a. and penal interest. The Corporate Debtor failed to respond to the recall notice. The Financial Creditor filed an application under

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## Issues and analysis

### Issue 1: Whether the application filed by the Financial Creditor is within the limitation period as per the …

**Ratio:** As per the Limitation Act, 1963, an application under Section 7 of the Insolvency and

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**Reasoning:** The Adjudicating Authority examined Part IV of the application in Form 1 and found that

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**Interpretation:** The Limitation Act, 1963 sets a time limit for filing legal proceedings. In the

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**Application:** In this case, the date of default was 2022-04-15, and the application was filed

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## Parties

- **Judges:** Praveen…; Ashish…
- **Appellants:** HADIRAH STEELS…
- **Respondents:** RANA HEAVY…
- **Advocates:** Sanjeev…; Babita…

## Timeline

- **2021-10-11 — Loan Facility…**: Financial Creditor and Corporate Debtor…
- **2021-11-30 — First Disbu…**: Financial Creditor disbursed…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 5(8) — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-5)

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