# In the matter of Edelweiss Asset Reconstruction Company Limited Vs. Sachet Infrastructure Pvt. Ltd. CA (AT) (Insolvency) No. 377- 2019

> NCLAT judgment dated 2019-09-20. Citation: TCN-2019-NCLAT-00257. These appeals challenge a common order dated 7th March, 2019, passed by the Adjudicating…

- **Court:** NCLAT
- **Order date:** 20 Sept 2019
- **Citation:** TCN-2019-NCLAT-00257
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/edelweiss-asset-reconstruction-company-limited-vs-sachet-infrastructure-pvt-ltd-c80433fc

## Summary

### Background

These appeals challenge a common order dated 7th March, 2019, passed by the Adjudicating Authority (National Company Law Tribunal), Special Bench, New Delhi. The core issue revolves around the initiation of Corporate Insolvency Resolution Process (CIRP) against multiple corporate debtors who are corporate guarantors for the same principal borrower, Adel Landmarks Limited. Edelweiss Asset Reconstruction Company Limited, the appellant, filed separate applications under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) against nine corporate debtors. The Adjudicating Authority primarily dealt with the case of Manogayan Estates Pvt. Ltd. and held that since CIRP had already been triggered against the principal borrower, Adel Landmarks Limited, for the same set of

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## Facts

Edelweiss Asset Reconstruction Company Limited (the Appellant) initiated Corporate Insolvency Resolution Process (CIRP) under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) against nine Corporate Debtors. These Corporate Debtors acted as Corporate Guarantors for a loan disbursed to Adel Landmarks Limited (the Principal Borrower). The loan amount was Rs. 170 Crores, provided by ECL Finance Limited (original Financial Creditor), later assigned to Edelweiss. The Adjudicating Authority dismissed the applications, leading to the appeals. The Corporate Debtors are landholders involved in a township project in Palwal, Haryana. Agreements were signed between Adel Landmarks Limited and the Corporate Debtors for the development. Licenses were granted by the

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority was correct in dismissing the applications under Section 7 of …

**Ratio:** The legal principle is that once an application under Section 7 filed by the Financial

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**Reasoning:** The court reasoned that the Adjudicating Authority failed to appreciate the

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**Interpretation:** The interpretation of Section 7 of the IBC and the precedent set in 'Dr. Vishnu

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**Application:** The court applied the ratio and reasoning to the specific facts of the case by

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## Parties

- **Judges:** S.J. Mukhop…; A.I.S. C…; +2 more
- **Appellants:** Edelweiss Asset…
- **Respondents:** Adel Landmarks…; Sachet Infrastruct…

## Timeline

- **2018-12-05 — Order by Adjudicating…**: Adjudicating Authority passed an…
- **2019-03-07 — Impugned…**: Common order dated 7th March, 2019 passed by the Adjudicating Authority (National Company…

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