# In the matter of Aeon Paper Mills Private Limited CP-577-(IB)-CB-2018

> NCLT judgment dated 2018-07-10. Citation: TCN-2018-NCLT-01170. The case involves an application filed under Section 10 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 10 Jul 2018
- **Citation:** TCN-2018-NCLT-01170
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/aeon-paper-mills-private-limited-cp-577-ib-cb-2018-84ec4e83

## Summary

### Background

The case involves an application filed under Section 10 of the Insolvency and Bankruptcy Code, 2016, by M/s. Aeon Paper Mills Private Limited, the Corporate Debtor, to initiate the Corporate Insolvency Resolution Process (CIRP). The application seeks the declaration of a moratorium and the appointment of an Interim Resolution Professional (IRP). The Financial Creditor, Canara Bank, opposed the application, citing ongoing SARFAESI proceedings to recover outstanding dues.

## Facts

M/s. Aeon Paper Mills Private Limited, the Corporate Debtor, filed an application under Section 10 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate the Corporate Insolvency Resolution Process (CIRP). The Corporate Debtor had availed loan facilities from Canara Bank, the Financial Creditor. The Corporate Debtor defaulted on repayment, leading the Financial Creditor to classify the loan accounts as Non-Performing Assets (NPA) on 2012-08-21. The Financial Creditor initiated action under the SARFAESI Act, 2002, issuing notices for recovery of dues. The outstanding debt owed to Canara Bank was Rs. 28,02,05,958. The Corporate Debtor placed on record sanction letters for term loans and working capital facilities. The Financial Creditor had also restructured

…

## Issues and analysis

### Issue 1: Whether the application filed by the Corporate Debtor under Section 10 of the Insolvency and …

**Ratio:** Section 10 of the Insolvency and Bankruptcy Code, 2016, allows a corporate debtor to

…

**Reasoning:** The court found that the documents placed on record clearly evidenced that the Corporate

…

**Interpretation:** Section 10 provides a mechanism for a corporate debtor to initiate insolvency

…

**Application:** The court applied Section 10 to the facts of the case, noting that the

…

## Parties

- **Judges:** CH. MOHD SHARIEF…
- **Respondents:** Aeon Paper Mills…

## Timeline

- **2009-12-07 — Sanction…**: Financial Creditor issued a Sanction Letter sanctioning the Term Loan to the tune of…
- **2011-02-07 — Sanction…**: Financial Creditor issued another Sanction Letter sanctioning Working Capital to the tune…

## Legal provisions

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

---

This is a preview. The full structured summary, issues, precedents and source judgment are available on CaseEase - Legal Intelligence Simplified: https://caseease.in/cases/ibc/nclt-chandigarh/aeon-paper-mills-private-limited-cp-577-ib-cb-2018-84ec4e83