Manik Lal Sanghi Vs Neeraj Pipes Pvt Ltd (NCLT Hyderabad)
The National Company Law Tribunal (NCLT), Hyderabad Bench, delivered its order in a company petition filed under Section 7 of the Insolvency and Bankruptcy Code, 2016 (“IBC”) by a financial creditor seeking initiation of the Corporate Insolvency Resolution Process (CIRP) against M/s Neeraj Pipes Private Limited (“Corporate Debtor”). The petition alleged default in repayment of ₹2.63 crore, including interest, as on 5 November 2024.
The petitioner, an experienced businessman, stated that he had extended financial assistance of ₹1.5 crore to the corporate debtor on 31 March 2018 to address its working capital needs. The disbursement was made by cheque and supported by bank statements. The corporate debtor executed a promissory note on the same date acknowledging receipt of funds and repayment within one year with interest. Despite repeated reminders, the debtor failed to repay the amount. Written acknowledgements of debt were issued by the corporate debtor on 1 October 2020 and 1 March 2022, admitting the liability and requesting more time for repayment.
Following the debtor’s continued default, the financial creditor issued a demand notice on 6 November 2024, seeking payment of ₹2.63 crore. The corporate debtor, in its reply dated 13 November 2024, admitted its inability to pay but offered no repayment plan. The petitioner argued that these communications, along with the promissory note and bank records, demonstrated the existence of a financial debt and a default under Section 3(12) of the IBC.
