Fabtech Technologies International Ltd Vs Buildmighty Techno Pvt. Ltd (NCLAT Delhi)
National Company Law Appellate Tribunal (NCLAT) in Delhi has overturned an order by the National Company Law Tribunal (NCLT) that dismissed a Section 7 insolvency application filed by Fabtech Technologies International Ltd. against its subsidiary, Buildmighty Techno Pvt. Ltd. The NCLAT ruled that the debt and default were sufficiently established, including through records from the National E-Governance Services Ltd. (NeSL) and an admission by the Corporate Debtor’s representative.
Fabtech Technologies International Ltd., acting as the Financial Creditor, had sought to initiate the Corporate Insolvency Resolution Process (CIRP) against Buildmighty Techno Pvt. Ltd. for an amount of ₹5,96,33,275, including interest calculated until May 11, 2022. The Corporate Debtor, which underwent several name changes, had purportedly received financial assistance from Fabtech Technologies International Ltd. at various intervals since 2012. The Financial Creditor alleged that repayments stopped after the financial year 2018-19.
The NCLT had dismissed the Section 7 application, primarily citing the absence of a written loan agreement and the inability to determine the exact date of default. It had also noted that the Financial Creditor failed to demonstrate how and when the loan was repayable and observed that no demand notice for repayment appeared to have been served. The NCLT concluded that without a clear due date, a demand notice recalling the loan was imperative to establish default.
