# In the matter of Ravi Electronics Private Limited

> NCLT judgment dated 2024-04-15. Citation: TCN-2024-NCLT-01732. M/s Pegasus Assets Reconstruction Private Limited, the Financial Creditor, filed a Company…

- **Court:** NCLT
- **Order date:** 15 Apr 2024
- **Citation:** TCN-2024-NCLT-01732
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/ravi-electronics-private-limited-67a0f888

## Summary

### Background

M/s Pegasus Assets Reconstruction Private Limited, the Financial Creditor, filed a Company Petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority Rules), 2016, for initiating Corporate Insolvency Resolution Process (CIRP) against M/s Ravi Electronics Private Limited, the Corporate Debtor. The Financial Creditor alleged that an amount of Rs.2,45,67,019.20 was due as of 22.12.2021, with the date of default being 03.12.2013. The Corporate Debtor had provided a corporate guarantee for a cash credit facility availed by M/s Instruments Techniques Pvt Ltd, the original borrower. The Corporate Debtor argued that the DRT proceedings were void ab initio and that the debt was

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## Facts

M/s Pegasus Assets Reconstruction Private Limited (Financial Creditor) filed a petition against M/s Ravi Electronics Private Limited (Corporate Debtor) under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking initiation of Corporate Insolvency Resolution Process (CIRP). The Financial Creditor claimed that the Corporate Debtor had defaulted on a debt of Rs.2,45,67,019.20 as of 22.12.2021, with the date of default being 03.12.2013. The Corporate Debtor had acted as a guarantor for a cash credit facility availed by M/s Instruments Techniques Pvt Ltd. The Financial Creditor had obtained a Recovery Certificate (RC) from the Debts Recovery Tribunal (DRT) for Rs.1,77,33,181.79. The Corporate Debtor contested the petition, arguing that the DRT proceedings were void

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## Issues and analysis

### Issue 1: Whether a financial debt claimed as due and payable by the respondent to the petitioner even …

**Ratio:** A decree or a Recovery Certificate issued by the Court/Tribunal having jurisdiction

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**Reasoning:** The NCLT found that the Corporate Debtor had executed a valid Guarantee Agreement and

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**Interpretation:** The legal principle is that a validly issued Recovery Certificate remains

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**Application:** The NCLT applied this principle to the facts of the case, noting that the

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## Parties

- **Judges:** Venkata Ramakrishn…; SH. CHARAN…
- **Appellants:** M/s Pegasus…
- **Respondents:** M/s Ravi Electroni…
- **Advocates:** R. Rajendra…; P. Ramesh…

## Timeline

- **2003-12-03 — Loan Account Classified…**: The loan account of the original borrower was…
- **2012-03-31 — Guarantee Ag…**: Corporate Debtor executed a Guarantee Agreement for guaranteeing a cash credit limit of…

## 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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