# In the matter of Bharat Bright Bars Private Limited CP No. 3967-I&BC-NCLt-MB-MAH-2018 & MA No. 1013-2018

> NCLT judgment dated 2019-09-25. Citation: TCN-2019-NCLT-01265. The case involves an application filed by Reliance Commercial Finance Limited, the 'Financial…

- **Court:** NCLT
- **Order date:** 25 Sept 2019
- **Citation:** TCN-2019-NCLT-01265
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/bharat-bright-bars-private-limited-cp-no-3967-ibc-nclt-mb-mah-2018-ma-no-1013-20-19e1ba3c

## Summary

### Background

The case involves an application filed by Reliance Commercial Finance Limited, the 'Financial Creditor', to initiate Corporate Insolvency Resolution Process (CIRP) against Bharat Bright Bars Private Limited, the 'Corporate Debtor', under Section 7 of the Insolvency and Bankruptcy Code, 2016. The petition was filed based on a default in payment of a 'Financial Debt'.

## Facts

Reliance Commercial Finance Limited ('Financial Creditor') filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Bharat Bright Bars Private Limited ('Corporate Debtor') to initiate Corporate Insolvency Resolution Process (CIRP). The petition was based on a 'Financial Debt' of Rs. 42,73,790/- arising from a 'Working Capital Loan' granted to the Corporate Debtor as per a Loan Agreement dated 2015-07-29. The date of first default was 2017-04-15, and the date of NPA was 2018-04-20. The Corporate Debtor remained absent throughout the proceedings, except for a brief appearance by an advocate who sought time for settlement. The Financial Creditor provided evidence of the loan agreement, disbursement of funds, and a 'Demand Promissory Note'.

## Issues and analysis

### Issue 1: Whether the debt in question qualifies as a 'Financial Debt' under Section 5(8) of the Insolvency …

**Ratio:** Section 5(8) of the Insolvency and

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**Reasoning:** The court considered the facts presented and concluded that the loan granted to the

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**Interpretation:** The interpretation of 'Financial Debt' under Section 5(8) includes a debt along

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**Application:** The court applied the definition of 'Financial Debt' to the facts of the case,

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## Parties

- **Judges:** M.K. Sh…; Chandra Bha…
- **Appellants:** Reliance Commercia…
- **Respondents:** Bharat Bright…

## Timeline

- **2015-07-29 — Loan Agreeme…**: Loan Agreement between Reliance Commercial Finance Limited and Bharat Bright Bars Private…
- **2017-04-15 — Date of First…**: The date of the first default in payment…

## 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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