# In the matter of Western Hill Foods Limited CP (IB) No.347-MB-IV-2021

> NCLT judgment dated 2022-11-03. Citation: TCN-2022-NCLT-00544. The case pertains to an application filed by Swikrutee Finance Private Limited, the Financial…

- **Court:** NCLT
- **Order date:** 3 Nov 2022
- **Citation:** TCN-2022-NCLT-00544
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/western-hill-foods-limited-cp-ib-no347-mb-iv-2021-70467c31

## Summary

### Background

The case pertains to an application filed by Swikrutee Finance Private Limited, the Financial Creditor/Applicant, against Western Hill Foods Limited, the Corporate Debtor, under Section 7 of the Insolvency and Bankruptcy Code, 2016, for initiating the Corporate Insolvency Resolution Process (CIRP). The Financial Creditor claimed a total default of Rs. 3,35,42,485 as of March 15, 2021, with the date of default mentioned in the petition as February 28, 2020. The Financial Creditor had granted various facilities to the Corporate Debtor, totaling Rs. 2,96,00,000, evidenced by multiple sanction letters issued between May 2016 and January 2019. The Financial Creditor also issued a Loan Recall Notice on February 28, 2020, claiming Rs. 3,13,89,055 due as of February 15, 2020.

## Facts

Swikrutee Finance Private Limited (Financial Creditor) filed an application under Section 7 of the Insolvency & Bankruptcy Code, 2016, against Western Hill Foods Limited (Corporate Debtor) to initiate Corporate Insolvency Resolution Process (CIRP). The Financial Creditor claimed a total default of Rs. 3,35,42,485 as of March 15, 2021, with the date of default being February 28, 2020. The Financial Creditor had granted facilities to the Corporate Debtor totaling Rs. 2,96,00,000, evidenced by sanction letters issued between May 2016 and January 2019. A Loan Recall Notice was issued on February 28, 2020, claiming Rs. 3,13,89,055 due as of February 15, 2020. The Corporate Debtor did not file an Affidavit in Reply despite multiple opportunities. The Corporate Debtor was

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## Issues and analysis

### Issue 1: Whether the application filed by the Financial Creditor under Section 7 of the I&B Code, 2016, …

**Ratio:** Section 7 of the I&B Code allows a Financial Creditor to initiate CIRP against a

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**Reasoning:** The Bench considered the material on record and found no reason to deny the petition

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**Interpretation:** Section 7 provides a mechanism for Financial Creditors to recover their dues by

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**Application:** The Corporate Debtor's admission of liability, coupled with the Financial

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## Parties

- **Judges:** Manoj Kumar…; KISHORE VEMULAPALL…
- **Appellants:** Swikrutee Finance…
- **Respondents:** Western Hill…

## Timeline

- **2020-02-15 — Due Date as per Loan…**: Amount of Rs. 3,13,89,055…
- **2020-02-28 — Date of D…**: Date of Default as…

## 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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