# 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-01159. 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-01159
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/avj-infrastructure-private-limited-cp-no-ib-208pb-2019-f9995d0a

## 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 default on a term loan facility granted to the corporate debtor. The corporate debtor had approached the petitioner in December 2013 for a term loan of Rs. 10.00 Crores to participate in auctions for minor mineral blocks in Haryana, which was sanctioned on 17.12.2013. The loan was to be repaid in 66 monthly installments commencing June 2015.

## Facts

Oriental Bank of Commerce (the 'Financial Creditor') filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016 ('IBC') to initiate Corporate Insolvency Resolution Process ('CIRP') against AVJ Infrastructure Private Limited (the 'Corporate Debtor'). The Corporate Debtor was incorporated on 21.07.2008. The Financial Creditor granted a term loan facility to the Corporate Debtor. In December 2013, the Corporate Debtor requested a term loan of Rs. 10.00 Crores to participate in auctions for minor mineral blocks in Haryana. The Financial Creditor sanctioned the loan on 17.12.2013. The loan was to be repaid in 66 equal monthly installments of Rs. 15.15 lac commencing from June 2015. The Corporate Debtor defaulted on repayments. The amount claimed to be in

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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 IBC allows a financial creditor to initiate CIRP against a corporate

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**Reasoning:** The court noted that the learned counsel for the petitioner argued that all requirements

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**Interpretation:** Section 7 of the IBC is interpreted to mean that if a financial creditor

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**Application:** The court applied this ratio to the facts by finding 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 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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