# In the matter of Athena Energy Ventures Private Limited CP (IB) No. 466-9-HDB-2019

> NCLT judgment dated 2020-03-04. Citation: TCN-2020-NCLT-01679. The State Bank of India filed an application under Section 7 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 4 Mar 2020
- **Citation:** TCN-2020-NCLT-01679
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/athena-energy-ventures-private-limited-cp-ib-no-466-9-hdb-2019-1893ee1b

## Summary

### Background

The State Bank of India filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Athena Energy Ventures Private Limited, the Corporate Guarantor, seeking initiation of Corporate Insolvency Resolution Process (CIRP). This application was filed due to the default committed by Athena Chhattisgarh Power Limited, the Principal Borrower, for whom Athena Energy Ventures Private Limited had provided a corporate guarantee. The Financial Creditor had already initiated CIRP against the Principal Borrower, which was admitted by the NCLT Hyderabad bench. The Corporate Debtor argued that a second application for the same debt is not maintainable under the IBC.

## Facts

State Bank of India (SBI), the Financial Creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016, against Athena Energy Ventures Private Limited, the Corporate Debtor, who acted as a Corporate Guarantor for Athena Chhattisgarh Power Limited, the Principal Borrower. The Principal Borrower had availed financial assistance from SBI and other banks, with SBI sanctioning Rs. 3069.68 crores and disbursing Rs. 2769.19 crores. The Principal Borrower defaulted, and its account was declared a Non-Performing Asset (NPA) on December 21, 2015. SBI had already filed an application under Section 7 of the IBC against the Principal Borrower, which was admitted by the NCLT Hyderabad bench on May 15, 2019, and CIRP was in progress. The Corporate

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## Issues and analysis

### Issue 1: Whether an application under Section 7 of the IBC can be admitted against the Corporate Guarantor …

**Ratio:** The legal principle is that a financial creditor cannot pursue two separate CIRP

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**Reasoning:** The court reasoned that allowing separate applications for the same claim would lead to

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**Interpretation:** The interpretation of Section 7 of the IBC, as clarified by the NCLAT, is that

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**Application:** In this case, since the application against the Principal Borrower (Athena

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## Parties

- **Judges:** Shri. K. Anantha…; BINOD KUMAR…
- **Appellants:** State Bank of…
- **Respondents:** Athena Energy…
- **Advocates:** Saini Kesh…; K.Anil…; +2 more

## Timeline

- **2011-01-01 — Principal Borrower…**: Athena Chhattisgarh Power Limited decided to avail financial assistance from financial…
- **2015-12-21 — Account decla…**: The account of the Principal Borrower was declared as Non-Performing Asset (NPA) by the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(2) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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