# In the matter of Barnaparichay Book Mall Private Limited C.P. (IB) No. 1219-KB-2018

> NCLT judgment dated 2019-08-09. Citation: TCN-2019-NCLT-01994. The case involves an application filed by Asset Reconstruction Company(India) Limited, the…

- **Court:** NCLT
- **Order date:** 9 Aug 2019
- **Citation:** TCN-2019-NCLT-01994
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/barnaparichay-book-mall-private-limited-cp-ib-no-1219-kb-2018-38a30316

## Summary

### Background

The case involves an application filed by Asset Reconstruction Company(India) Limited, the Financial Creditor, under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Barnaparichay Book Mall Private Limited, the Corporate Debtor. The Financial Creditor alleges that the Corporate Debtor defaulted on a repayment of Rs. 48,39,19,222/-. State Bank of Patiala (SBP) had assigned the debt to the Financial Creditor. The Corporate Debtor approached the Financial Creditor for settlement and restructuring of the debt, but the proposal was rejected. The SBP had declared the Corporate Debtor's account as NPA on 31-03-2011 and filed OA 238/2014 before the Debt Recovery Tribunal-III, Kolkata.

## Facts

Asset Reconstruction Company(India) Limited filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Barnaparichay Book Mall Private Limited, alleging a default in repayment of Rs. 48,39,19,222/-. State Bank of Patiala (SBP) had originally extended credit facilities to the Corporate Debtor, secured by hypothecation of moveable assets and mortgage of immovable property. SBP declared the account as NPA on 31-03-2011 and filed OA 238/2014 before the Debt Recovery Tribunal-III, Kolkata. Subsequently, SBP assigned the debt to Asset Reconstruction Company(India) Limited via an Assignment Deed dated 26-03-2014. The Corporate Debtor approached the Financial Creditor for settlement and restructuring of the debt, but the proposal was rejected.

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## Issues and analysis

### Issue 1: Whether the application filed by the Financial Creditor under Section 7 of the Insolvency and …

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

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**Reasoning:** The court considered the documents and evidence presented by the Financial Creditor,

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**Interpretation:** Section 7 of the IBC provides a mechanism for financial creditors to recover

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**Application:** The court found that the Financial Creditor had successfully established that

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## Parties

- **Judges:** Jinan…; Harish Chander…
- **Appellants:** Asset Reconstructi…
- **Respondents:** Barnaparichay…; M/s. Barnaparichay…

## Timeline

- **2011-03-31 — Account decla…**: State Bank of Patiala (SBP) declared the Corporate Debtor's account as Non-Performing…
- **2014-03-26 — Assignmen…**: State Bank of Patiala (SBP) assigned the debt to Asset Reconstruction Company(India)…

## 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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