# In the matter of  Jasani Realty Pvt.Ltd. Vs. Vijay Corporation Commercial Arbitration Application (L) No. 1242 of 2022

> HC judgment dated 2022-04-25. Citation: TCN-2022-HC-00051. The case involves a commercial arbitration application filed by Jasani Realty Pvt. Ltd. against…

- **Court:** HC
- **Order date:** 25 Apr 2022
- **Citation:** TCN-2022-HC-00051
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/high-courts-new-delhi/jasani-realty-pvtltd-vs-vijay-corporation-commercial-arbitration-application-a10f8f39

## Summary

### Background

The case involves a commercial arbitration application filed by Jasani Realty Pvt. Ltd. against Vijay Corporation. The dispute arose from loan agreements between the parties. Jasani Realty sought the appointment of an arbitral tribunal under Section 11 of the Arbitration and Conciliation Act, 1996 (ACA). Vijay Corporation opposed the application, arguing that prior proceedings initiated under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) before the NCLT constituted an embargo on the court's jurisdiction to appoint an arbitral tribunal. The respondent contended that the applicant was attempting to evade consequences under the IBC. The applicant argued that since the NCLT had not admitted the Section 7 proceedings, there was no bar to the court's power to

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## Facts

Jasani Realty Pvt. Ltd. (applicant) and Vijay Corporation (respondent) entered into a loan agreement dated April 23, 2015, for Rs.4,50,00,000/-. A subsequent agreement dated July 5, 2016, extended the repayment date to March 31, 2017. Jasani Realty defaulted on loan installments. In discharge of its liability, Jasani Realty issued a cheque dated September 7, 2021, for Rs.31,08,33,457/- to Vijay Corporation, which was dishonored. Vijay Corporation initiated proceedings against Jasani Realty under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) before the National Company Law Tribunal (NCLT) on October 12, 2021. Jasani Realty invoked the arbitration agreement via notice dated December 10, 2021, and filed an application under Section 11 of the Arbitration and

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## Issues and analysis

### Issue 1: Whether the mere filing of proceedings under Section 7 of the Insolvency and Bankruptcy Code, 2016 …

**Ratio:** The Supreme Court in Indus Biotech Private Limited vs. Kotak India Venture (Offshore)

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**Reasoning:** The court reasoned that the mere filing of Section 7 proceedings does not trigger the

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**Interpretation:** The court interpreted the Supreme Court's decision in Indus Biotech to mean

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**Application:** In this case, since the NCLT had not admitted the Section 7 proceedings

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## Parties

- **Judges:** G. S. KUL…
- **Appellants:** Jasani Realty Pvt…
- **Respondents:** Vijay Corpo…

## Timeline

- **2015-04-23 — Loan Agre…**: Loan agreement entered between Jasani Realty…
- **2016-07-05 — Subsequent Ag…**: Agreement extending the…

## 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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