# In the matter of Stellence Pharmscience Pvt. Ltd.

> NCLT judgment dated 2024-03-06. Citation: TCN-2024-NCLT-02179. The case involves an application filed by Religare Finvest Ltd. under Section 7 of the…

- **Court:** NCLT
- **Order date:** 6 Mar 2024
- **Citation:** TCN-2024-NCLT-02179
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/stellence-pharmscience-pvt-ltd-a4ba415c

## Summary

### Background

The case involves an application filed by Religare Finvest Ltd. under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against Stellence Pharmscience Pvt. Ltd. Religare Finvest claims that Stellence Pharmscience defaulted on a debt of Rs. 21,38,75,169.23/- as of 28.11.2022, with the date of default being 01.10.2021. The application was filed before the National Company Law Tribunal (NCLT), Bengaluru.

## Facts

Religare Finvest Ltd. (Financial Creditor) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Stellence Pharmscience Pvt. Ltd. (Corporate Debtor). The Corporate Debtor availed four loan facilities from the Financial Creditor between 2014 and 2015, totaling Rs. 29,00,31,556/-. These loans were secured by depositing title deeds. The Corporate Debtor defaulted on its EMI payments, leading to its account being declared NPA on 30.11.2018. A Memorandum of Understanding (MoU) was executed on 29.08.2019 to regularize the account, but the Corporate Debtor defaulted again on 01.10.2021. As of 28.11.2022, the total outstanding amount was Rs. 21,38,75,169.23/-. The Corporate Debtor

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor defaulted on …

**Ratio:** The Adjudicating Authority is to only determine whether a 'default' has occurred and

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**Reasoning:** The Corporate Debtor's loan repayment irregularities led to its account being declared

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**Interpretation:** The court interpreted that the default occurred when the Corporate Debtor

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**Application:** The Corporate Debtor's failure to adhere to the terms of the loan agreement and

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## Parties

- **Judges:** T. Krishn…; Manoj Kumar…
- **Appellants:** Religare Finvest…
- **Respondents:** Stellence…

## Timeline

- **2014-01-01 — Loan Facilitie…**: Corporate Debtor availed four loan facilities from 2014 to 2015 totalling Rs.…
- **2018-11-30 — Account Decla…**: Corporate Debtor's account was…

## 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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