# In the matter of AVJ Infrastructure Private Limited C.P. No. IB-208(PB)-2019

> NCLT judgment dated 2019-09-30. Citation: TCN-2019-NCLT-01168. Oriental Bank of Commerce filed a petition under Section 7 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 30 Sept 2019
- **Citation:** TCN-2019-NCLT-01168
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/avj-infrastructure-private-limited-cp-no-ib-208pb-2019-9b668249

## Summary

### Background

Oriental Bank of Commerce filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against AVJ Infrastructure Private Limited. The corporate debtor was incorporated on 21.07.2008. The financial creditor claimed a default of Rs. 10,39,54,063/- as of 30.11.2016. The corporate debtor had approached the petitioner in December 2013 for a term loan facility of Rs. 10.00 Crores, which was sanctioned on 17.12.2013, to be repaid in 66 monthly installments commencing from June 2015. The account of the corporate debtor was classified as NPA on 29.01.2017. The financial creditor issued a notice on 15.03.2017 under Section 13(2) of the Securitization and Reconstruction of Financial Assets and

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## Facts

Oriental Bank of Commerce (Financial Creditor) filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against AVJ Infrastructure Private Limited (Corporate Debtor). The Corporate Debtor was incorporated on 21.07.2008. The Financial Creditor claimed a default of Rs. 10,39,54,063/- as of 30.11.2016. In December 2013, the Corporate Debtor requested a term loan facility of Rs. 10.00 Crores from the Financial Creditor for participating in auctions for minor mineral blocks in Haryana. The loan was sanctioned on 17.12.2013, to be repaid in 66 monthly installments of Rs. 15.15 lac commencing from June 2015. The Corporate Debtor defaulted on payments with defaults occurring on 30.11.2016,

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## Issues and analysis

### Issue 1: Whether the requirements of Section 7 of the Insolvency and Bankruptcy Code, 2016, for initiating …

**Ratio:** Section 7 of the Insolvency and Bankruptcy Code, 2016, allows a financial creditor to

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**Reasoning:** The court considered the submissions of the petitioner, the documents on record, and the

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**Interpretation:** Section 7 provides the mechanism for a financial creditor to trigger CIRP when

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**Application:** The court applied Section 7 to the facts of the case, noting that the financial

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## Parties

- **Judges:** M. M. K…; DEEPTI M…
- **Appellants:** Oriental Bank of…
- **Respondents:** AVJ Infrastructure…

## Timeline

- **2008-07-21 — Incorporation of…**: AVJ Infrastructure Private…
- **2013-12-01 — Corporate Debtor…**: AVJ Infrastructure Private Limited approached Oriental Bank of Commerce for a term loan…

## 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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