# in the matter of Usha India Limited

> NCLT judgment dated 2023-10-05. Citation: TCN-2023-NCLT-01390. The Administrator of Specified Undertaking of the Unit Trust of India (SUUTI) filed an…

- **Court:** NCLT
- **Order date:** 5 Oct 2023
- **Citation:** TCN-2023-NCLT-01390
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/usha-india-limited-5bdb7a1a

## Summary

### Background

The Administrator of Specified Undertaking of the Unit Trust of India (SUUTI) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against M/s Usha India Limited, seeking initiation of Corporate Insolvency Proceedings. The application was triggered by the Corporate Debtor's failure to honor its obligations under debentures issued in 1992, leading to defaults in interest payments from July 1998. The Financial Creditor declared the Corporate Debtor's account as NPA on 28.09.1998. Despite several attempts at resolution, including One Time Settlement (OTS) offers and proceedings before the Debt Recovery Tribunal (DRT), the debt remained outstanding. The Corporate Debtor's application was registered under the Sick Industrial Companies (Special

…

## Facts

The Administrator of Specified Undertaking of the Unit Trust of India (SUUTI) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against M/s Usha India Limited. The Corporate Debtor issued debentures in 1992, and a Debenture Trust Deed was executed on 08.11.1996. The Corporate Debtor defaulted on interest payments from July 1998, leading to the Financial Creditor declaring the account as NPA on 28.09.1998. The redemption dates for the debentures were in 1999, 2000, and 2001. The Financial Creditor issued recall notices on 13.01.2003. The Corporate Debtor's application was registered under the Sick Industrial Companies (Special Provisions) Act, 1985, on 18.06.2002. The Financial Creditor approached the Debt Recovery Tribunal (DRT), Mumbai,

…

## Issues and analysis

### Issue 1: Whether the application under Section 7 of the Insolvency and Bankruptcy Code, 2016, is …

**Ratio:** Section 7 of the IBC allows a financial creditor to initiate corporate insolvency

…

**Reasoning:** The Tribunal found that the Financial Creditor had submitted sufficient evidence to prove

…

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

…

**Application:** The Tribunal applied Section 7 to the facts of the case, finding that the

…

## Parties

- **Judges:** Praveen…; Ashish…
- **Appellants:** The Administrator…
- **Respondents:** Usha India…; M/S USHA INDIA…

## Timeline

- **1992-01-01 — Debenture I…**: Corporate Debtor issued…
- **1996-11-08 — Debenture Tru…**: Corporate Debtor and UTI…

## Legal provisions

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

---

This is a preview. The full structured summary, issues, precedents and source judgment are available on CaseEase - Legal Intelligence Simplified: https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/usha-india-limited-5bdb7a1a