# In the matter of Balaji Polysacks Private Ltd. CP No. 590-KB-2017

> NCLT judgment dated 2017-12-14. Citation: TCN-2017-NCLT-00054. Premier Enclave Pvt. Limited, the financial creditor/applicant, filed a petition under Section…

- **Court:** NCLT
- **Order date:** 14 Dec 2017
- **Citation:** TCN-2017-NCLT-00054
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/balaji-polysacks-private-ltd-cp-no-590-kb-2017-9b14b8aa

## Summary

### Background

Premier Enclave Pvt. Limited, the financial creditor/applicant, filed a petition under Section 7 of the Insolvency & Bankruptcy Code, 2016, read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, for the initiation of Corporate Insolvency Resolution Process against the corporate debtor, Balaji Polysacks Private Ltd. The applicant claimed that it had extended financial assistance of Rs. 25,00,000/- to the corporate debtor, and the corporate debtor had defaulted in repayment, with an outstanding exposure of Rs. 29,69,109/- as of September 15, 2017.

## Facts

Premier Enclave Pvt. Limited (the applicant) is a Non-Banking Financial Institution. It extended financial assistance of Rs. 25,00,000/- to Balaji Polysacks Private Ltd. (the corporate debtor) in the form of a loan, with interest at 9% p.a., dated January 29, 2013. The corporate debtor acknowledged receipt of the loan via a letter dated February 4, 2013. As of September 15, 2017, the total outstanding exposure, including principal, accrued interest, and penal interest, was Rs. 29,69,109/-. The corporate debtor failed to repay the loan despite repeated demands. The applicant filed a petition under Section 7 of the Insolvency & Bankruptcy Code, 2016, for initiation of Corporate Insolvency Resolution Process. The corporate debtor objected, claiming the petition was

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## Issues and analysis

### Issue 1: Whether the objections raised by the Respondent / Corporate Debtor is sustainable under section 7 …

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

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**Reasoning:** The court reasoned that the corporate debtor failed to disprove the existence of the

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**Interpretation:** Section 7 is interpreted to mean that if a financial creditor can demonstrate

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**Application:** The court applied the ratio to the facts by noting that the petitioner provided

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## Parties

- **Judges:** V. P. S…; K.R. J…
- **Appellants:** Premier Enclave…
- **Respondents:** Balaji Polysacks…

## Timeline

- **2013-01-29 — Loan Agre…**: Loan agreement dated January 29, 2013, between Premier Enclave Pvt. Limited and Balaji…
- **2013-02-04 — Acknowledgment…**: Letter dated February 4, 2013, from Balaji Polysacks Private Ltd. acknowledging receipt…

## 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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