Section 7 IP on a valid financial debt

The Hyderabad Bench of the National Company Law Tribunal examined an application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016 by Aditya Birla Capital Limited seeking initiation of Corporate Insolvency Resolution Process (“CIRP”) against Spectra India Eco Projects Private Limited. 

Upon examining the loan documents, security creation records, account statements, recall notices, and evidence of default, the Tribunal held that a valid financial debt existed and that the Corporate Debtor had committed default in repayment. Finding that the application was complete and within limitation, the Tribunal admitted the petition, commenced CIRP, appointed an Interim Resolution Professional (“IRP”), and imposed the statutory moratorium under Section 14 of the Code.