# In the matter of M/s. Lepakshi Knowledge Hub Pvt. Ltd.
Vs.
Global Emerging Markets India Ltd. Company Appeal (AT) (CH) (INS) No. 214 & 216 of 2022

> NCLAT judgment dated 2022-08-02. Citation: TCN-2022-NCLAT-00312. The case involves two Company Appeals, No. 214 and 216 of 2022, filed before the National…

- **Court:** NCLAT
- **Order date:** 2 Aug 2022
- **Citation:** TCN-2022-NCLAT-00312
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/ms-lepakshi-knowledge-hub-pvt-ltd-vs-global-emerging-markets-india-ltd-company-a-ad8fafe5

## Summary

### Background

The case involves two Company Appeals, No. 214 and 216 of 2022, filed before the National Company Law Appellate Tribunal (NCLAT) at Chennai. The appeals were initiated by Lepakshi Knowledge Hub Private Limited, challenging the admission of Company Petitions filed under Section 7 of the Insolvency and Bankruptcy Code (IBC) by Global Emerging Markets India Ltd. against Lepakshi Heritage Wellness Village Private Limited and Lepakshi Science and Technology Park Private Limited, respectively. The Adjudicating Authority, the National Company Law Tribunal (NCLT), Bengaluru Bench, had admitted the petitions, leading to the appeals.

## Facts

In 2012, Global Emerging Markets India Ltd. (GEM), the Financial Creditor, entered into a Memorandum of Understanding (MoU) with Lepakshi Knowledge Hub Private Limited (LKH) for a project in Andhra Pradesh. As part of this, GEM agreed to purchase 100% equity shareholding in Lepakshi Science and Technology Park Private Limited (LST) and Lepakshi Heritage Wellness Village Private Limited (LHW) for Rs. 238.5 Crores. GEM forwarded Rs. 5 Crores to LST through an Inter-Corporate Deposit (ICD) dated 19.03.2012, intended for stamp duty for land transfer. LHW executed a corporate guarantee for the ICD. The ICD tenure was six months, interest-free, but with 18% interest per annum if not repaid. LKH was to transfer land to LST and LHW. GEM was to pay the first tranche of Rs. 25

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority erred in admitting the Company Petition under Section 7 of the …

**Ratio:** Section 7 of the IBC allows a financial creditor to initiate corporate insolvency

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**Reasoning:** The NCLAT reasoned that the Adjudicating Authority correctly found that a financial debt

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**Interpretation:** Section 7 of the IBC provides a mechanism for financial creditors to initiate

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**Application:** The NCLAT applied the ratio by affirming that the Adjudicating Authority had

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## Parties

- **Judges:** M. Venu…; KanthiNar…
- **Appellants:** M/s. Lepakshi…
- **Respondents:** M/s. Lepakshi…; Global Emerging…

## Timeline

- **2008-12-22 — Memorandum of…**: Memorandum of Agreement between the Government of Andhra Pradesh and Lepakshi Knowledge…
- **2012-01-07 — Memorandum of…**: Memorandum of Understanding between Financial…

## 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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