# In the matter of Warm Forgings Pvt. Ltd.

> NCLT judgment dated 2024-01-19. Citation: TCN-2024-NCLT-02999. The case involves a petition filed by M/s Surya Testing Services Ltd. ('Financial Creditor')…

- **Court:** NCLT
- **Order date:** 19 Jan 2024
- **Citation:** TCN-2024-NCLT-02999
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/warm-forgings-pvt-ltd-a58abf7e

## Summary

### Background

The case involves a petition filed by M/s Surya Testing Services Ltd. ('Financial Creditor') against M/s Warm Forging Private Limited ('Corporate Debtor') under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking initiation of Corporate Insolvency Resolution Process ('CIRP') due to default in repayment of a loan. The Corporate Debtor filed an Interlocutory Application ('IA') bearing the IA (IBC) No. 651/JPR/2022 for rejection and dismissal of the application. The Corporate Debtor also filed IA No. 652/JPR/2022 under Section 60(5) read with Section 7(5)(b) of IBC, 2016 read with Rule 11 of NCLT Rules, 2016 for rejection and dismissal of the Application filed under Section 7 of the Code, 2016 on ground that there is no debt due & default committed by the

…

## Facts

M/s Surya Testing Services Ltd. ('Financial Creditor') filed a petition against M/s Warm Forging Private Limited ('Corporate Debtor') under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking initiation of CIRP due to default in repayment of a loan. The Corporate Debtor filed Interlocutory Applications ('IA') for rejection and dismissal of the application. The Corporate Debtor argued that the amount disbursed by the Financial Creditor was for equity investment in M/s Selma Precision Technologies, NC, LLC ('SPT'), a company incorporated in the USA by the directors of the Corporate Debtor. The Financial Creditor contended that the amount was disbursed as a loan. The amount disbursed was Rs. 1,85,00,000/-, out of which Rs. 25,00,000/- was repaid. A legal notice

…

## Issues and analysis

### Issue 1: Whether the amount of Rs. 1,60,00,000/- (Rupees One Crore Sixty Lakh) disbursed by the Financial …

**Ratio:** Section 5(8) of the IBC defines 'financial debt' as a debt along with interest, if any,

…

**Reasoning:** The court reasoned that the amount disbursed by the Financial Creditor was credited in

…

**Interpretation:** The court interpreted Section 5(8)(f) of the Code to cover any amount raised

…

**Application:** The court applied the definition of 'financial debt' under Section 5(8)(f) of

…

## Parties

- **Judges:** Deep Chandr…; RAJEEV ME…
- **Respondents:** M/S WARM FORGING…; M/S SURYA TESTING…

## Timeline

- **2021-01-01 — CP No. (IB)- 92/7/JPR/20…**: The main petition bearing CP No. (IB)- 92/7/JPR/2021 has been filed by M/s Surya Testing…
- **2022-01-01 — IA No. 651/J…**: The Interlocutory Application ('IA') bearing the IA (IBC) No. 651/JPR/2022 is filed by…

## 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)

---

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/warm-forgings-pvt-ltd-a58abf7e