# In the matter of A. Power Himalayas Ltd. CP (IB) No. 75-Chd-HP-2017

> NCLT judgment dated 2017-11-03. Citation: TCN-2017-NCLT-00244. Punjab National Bank filed a petition under Section 7 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 3 Nov 2017
- **Citation:** TCN-2017-NCLT-00244
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/a-power-himalayas-ltd-cp-ib-no-75-chd-hp-2017-24516886

## Summary

### Background

Punjab National Bank filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, against A. Power Himalayas Ltd., alleging default on loan repayments. The corporate debtor had approached the financial creditor for various credit facilities, including term loans and bank guarantees, to finance its power projects. The bank claimed that the corporate debtor defaulted on these loans, leading to the petition for initiating the corporate insolvency resolution process. The corporate debtor opposed the petition, arguing that it was a potentially viable MSME account and that the bank had a statutory duty to rehabilitate the account under RBI guidelines. The corporate debtor also cited delays in project implementation due to external factors and alleged that

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## Facts

Punjab National Bank (PNB) filed a petition against A. Power Himalayas Ltd. under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016. PNB, acting as the financial creditor, claimed that A. Power Himalayas Ltd., the corporate debtor, defaulted on loan repayments. The corporate debtor had approached PNB for credit facilities, including a term loan of ₹1100 lacs and a bank guarantee of ₹50 lacs for business expansion. These facilities were sanctioned in 2007. Further credit facilities were extended in 2011, including a term loan of ₹2 crores and a bank guarantee of ₹1.20 crores. Various guarantee agreements and counter indemnities were executed. The corporate debtor again approached the financial creditor for fresh FITL of ₹186.02 lakhs and re-schedulement of

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## Issues and analysis

### Issue 1: Whether the financial creditor, Punjab National Bank, complied with the requirements of Section 7 …

**Ratio:** Section 7(3) of the IBC requires the financial creditor to furnish a record of default,

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**Reasoning:** The tribunal found that the financial creditor had produced sufficient evidence of

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**Interpretation:** Section 7 of the IBC outlines the procedure for initiating the corporate

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**Application:** In this case, the financial creditor, PNB, provided records of default,

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## Parties

- **Judges:** R.P.Nag…
- **Appellants:** Punjab National…
- **Respondents:** A. Power Himalayas…

## Timeline

- **1970-03-31 — Incorporation of…**: The petitioner-bank, Punjab National Bank, was incorporated under the Banking Companies…
- **1984-08-02 — Incorporation of…**: The respondent-corporate debtor, A.…

## 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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