# 13th Feb 2018 in the matter of Peace Infrastructure Pvt Ltd C.P. (IB) No. 179-9-NCLT-AHM-2017

> NCLT judgment dated 2018-02-13. Citation: TCN-2018-NCLT-01836. Dena Bank, styling itself as a financial creditor, filed an application under Section 7 of the…

- **Court:** NCLT
- **Order date:** 13 Feb 2018
- **Citation:** TCN-2018-NCLT-01836
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/13th-feb-2018-in-the-matter-of-peace-infrastructure-pvt-ltd-cp-ib-no-179-9-nclt-5b04e4c3

## Summary

### Background

Dena Bank, styling itself as a financial creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code (IBC) read with Regulation 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Peace Infrastructure Pvt. Ltd., the corporate debtor. The bank claimed that the corporate debtor had defaulted on a loan facility. The respondent raised objections regarding discrepancies in the amounts stated in different documents, the declaration of the respondent company as NPA, the petitioner's locus standi, and the pendency of other proceedings. The bank sanctioned a term loan of 5.00 crores vide sanction letter dated 04.06.2013 to the respondent

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## Facts

Dena Bank, claiming to be a financial creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code (IBC) to initiate Corporate Insolvency Resolution Process (CIRP) against Peace Infrastructure Pvt. Ltd. The bank had sanctioned a term loan of Rs. 5.00 crores to the respondent company on 04.06.2013 for the development of two projects. The respondent company executed a loan agreement, deed of hypothecation, deed of guarantee, and general undertaking in favor of the petitioner bank on 03.08.2013. The respondent company failed to honor the terms and conditions of the credit facility, leading the petitioner bank to classify the account as Non-Performing Assets (NPA) on 30.06.2015. After declaring it as NPA, respondent company paid Rs. 43.91 lacs from

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## Issues and analysis

### Issue 1: Whether the Chief Manager of Dena Bank was …

**Ratio:** An officer of a bank, such as a Senior Manager, who is authorized to grant a loan, is

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**Reasoning:** The Adjudicating Authority relied on a judgment by the NCLAT in Company Appeal (AT)

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**Interpretation:** The authority to initiate CIRP is considered an extension of the authority to

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**Application:** The Chief Manager of Dena Bank, being authorized to manage the loan, was deemed

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## Parties

- **Judges:** BIKKI RAVEENDRA…; Manorama…
- **Appellants:** Dena…
- **Respondents:** Peace Infrastructu…

## Timeline

- **2013-06-04 — Loan San…**: Petitioner bank sanctioned a term loan of…
- **2013-08-03 — Loan Agre…**: Respondent company executed loan agreement, deed of hypothecation, deed of guarantee and…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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