# In the matter of Telangana State Industrial Infrastructure Corporation Limited CP (IB) No. 285-9-HDB-2019

> NCLT judgment dated 2023-05-22. Citation: TCN-2023-NCLT-03230. The Operational Creditor, Nacre Gardens Hyderabad Ltd, filed a petition under Section 9 of the…

- **Court:** NCLT
- **Order date:** 22 May 2023
- **Citation:** TCN-2023-NCLT-03230
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/telangana-state-industrial-infrastructure-corporation-limited-cp-ib-no-285-9-hdb-baffc7bc

## Summary

### Background

The Operational Creditor, Nacre Gardens Hyderabad Ltd, filed a petition under Section 9 of the Insolvency and Bankruptcy Code (IBC) against the Corporate Debtor, Telangana State Industrial Infrastructure Corporation Ltd, alleging a default of Rs. 260.51 Crores. The petition sought the commencement of the Corporate Insolvency Resolution Process (CIRP), a moratorium, and the appointment of an Interim Resolution Professional. The Corporate Debtor denied the allegations, arguing that the petition was not maintainable due to a pending SLP before the Supreme Court challenging orders of the High Court related to the same matter. The Corporate Debtor also contended that it had already deposited a sum of Rs. 456,39,88,858.01 as per the orders of the Supreme Court in a related

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## Facts

Nacre Gardens Hyderabad Ltd (Operational Creditor) filed a petition against Telangana State Industrial Infrastructure Corporation Ltd (Corporate Debtor) under Section 9 of the IBC, claiming a default of Rs. 260.51 Crores. The claim arose from a failed project where Unitech Limited (formerly known as Unitech Hyderabad Township Limited) was to develop an Integrated Township Project/Multi Services Aerospace Park on land owned by the Corporate Debtor. Unitech deposited INR 165 crore with the Corporate Debtor, including an earnest money deposit of INR 20 crore. The Letter of Award (LoA) was conditional upon the Corporate Debtor claiming title before the High Court of Andhra Pradesh. The High Court ruled that the Corporate Debtor had no title to the land. The Supreme Court

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## Issues and analysis

### Issue 1: Whether the Operational Debt as …

**Ratio:** The existence of an operational debt is a prerequisite for initiating CIRP under Section

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**Reasoning:** The NCLT found that the Corporate Debtor had deposited a sum of Rs. 456,39,88,858.01 as

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**Interpretation:** The existence of an operational debt is a prerequisite for initiating CIRP

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**Application:** In this case, the NCLT found that the Corporate Debtor had deposited a sum of

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## Parties

- **Judges:** Venkata Ramakrishn…; SH. CHARAN…
- **Appellants:** Nacre Gardens…
- **Respondents:** Telangana State…
- **Advocates:** Avinash…; J.Ramachand…

## Timeline

- **2007-09-17 — Initial D…**: Unitech deposited INR…
- **2007-11-28 — Letter of…**: Corporate Debtor issued a Letter of…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 9 — Application for initiation of corporate insolvency…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-9)

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