# In the matter of Shyam Sunder Bhatiya Vs. Mr. Khozim Yusuf Nagarwala & Anr. CA(AT)(Ins) No. 558 of 2019

> NCLAT judgment dated 2019-12-11. Citation: TCN-2019-NCLAT-00031. The case involves an appeal against the order dated 3rd May, 2019, passed by the Adjudicating…

- **Court:** NCLAT
- **Order date:** 11 Dec 2019
- **Citation:** TCN-2019-NCLAT-00031
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/shyam-sunder-bhatiya-vs-mr-khozim-yusuf-nagarwala-anr-ca-5f63cf7a

## Summary

### Background

The case involves an appeal against the order dated 3rd May, 2019, passed by the Adjudicating Authority, National Company Law Tribunal, Jaipur Bench, Jaipur, which admitted an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC). The appellant, a shareholder of the Corporate Debtor, filed the appeal. The first respondent, the Financial Creditor, had filed the application under Section 7 of IBC before the Adjudicating Authority, Jaipur Bench, Jaipur, for initiating the Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor, M/s Raj Buildhome Private Limited, alleging default on a loan of Rs. 41,90,000/-.

## Facts

The first respondent, Khozim Yusuf Nagarwala, filed an application under Section 7 of the IBC before the Adjudicating Authority, Jaipur Bench, for initiating CIRP against the Corporate Debtor, M/s Raj Buildhome Private Limited, due to a default on a loan of Rs. 41,90,000/-. The loan was granted by the Financial Creditor during the financial year 2013-14 and reflected as Long Term Borrowing in the Corporate Debtor's balance sheet for the financial years ending 31.03.2014 and 31.03.2015. The Corporate Debtor issued a written undertaking dated 09.02.2016, admitting the debt. A cheque for Rs. 1,58,27,634/- issued by the Corporate Debtor was dishonored, leading to a notice under Section 138 of the Negotiable Instruments Act, 1881. The Corporate Debtor claimed the Financial

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## Issues and analysis

### Issue 1: Whether the Appellant i.e., Corporate Debtor has paid the debt prior to admission of Application …

**Ratio:** The ratio is that if payments have been made by the Corporate Debtor prior to the

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**Reasoning:** The court reasoned that the payments made by the Corporate Debtor before the admission of

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**Interpretation:** The interpretation is that the existence of a 'debt' and 'default' are

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**Application:** In this case, the court found that the Corporate Debtor had made payments

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## Parties

- **Judges:** A.I.S. C…; Kanthi Na…; +1 more
- **Appellants:** Shyam Sunder…
- **Respondents:** M/s Raj Buildhome…; Khozim Yusuf…

## Timeline

- **2013-01-01 — Loan Gra…**: The 1st Respondent (Financial Creditor) granted a loan to the Corporate Debtor during the…
- **2015-03-30 — Director Appo…**: The Financial Creditor became a…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 138 — Discharge order](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-138)

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