# In the matter of Busabong & Co. Private Limited C.P. No. 4395-IBC-MB-2019

> NCLT judgment dated 2021-07-26. Citation: TCN-2021-NCLT-01613. Plutusone Hospitality Private Limited, the Financial Creditor, filed a petition under Section 7…

- **Court:** NCLT
- **Order date:** 26 Jul 2021
- **Citation:** TCN-2021-NCLT-01613
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/busabong-co-private-limited-cp-no-4395-ibc-mb-2019-13e7fa8a

## Summary

### Background

Plutusone Hospitality Private Limited, the Financial Creditor, filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Busabong & Co. Private Limited, the Corporate Debtor. The Financial Creditor alleged that the Corporate Debtor defaulted in making payment of Rs. 7,02,682/-. The petition was based on a Restaurant Operations and Services Agreement (ROSA) where Plutusone was to finance, furnish, and equip restaurants operated by Busabong. Disputes arose regarding the provision and repayment of working capital.

## Facts

Plutusone Hospitality Private Limited (Financial Creditor) and Busabong & Co. Private Limited (Corporate Debtor) entered into a Restaurant Operations and Services Agreement (ROSA) on December 8, 2017. Under the ROSA, Plutusone was to finance, furnish, and equip restaurants in Mumbai, which would be operated by Busabong under the brand names 'Busago' or 'Busaba'. Plutusone was to provide capital expenditure of up to Rs. 35,00,000/- per outlet. The restaurants were set up at Powai, Mulund, and Thane. The premises for these restaurants were rented in the name of the Financial Creditor. The Corporate Debtor was responsible for arranging working capital from the operating account. In March 2018, the Corporate Debtor allegedly owed Rs. 6,26,006 to the Financial Creditor.

…

## Issues and analysis

### Issue 1: Whether the amount of Rs. 7,02,682/- claimed by the Financial Creditor constitutes a 'Financial …

**Ratio:** A 'Financial Debt' is defined under Section 5(8) of the IBC as a debt along with

…

**Reasoning:** The NCLT reasoned that the amount claimed was intended as working capital to be provided

…

**Interpretation:** The NCLT interpreted the ROSA as an investment agreement where the Financial

…

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

…

## Parties

- **Judges:** H.V. Subb…; Chandra Bha…
- **Appellants:** Plutusone…
- **Respondents:** Busabong&Co.…

## Timeline

- **2017-12-08 — Restaurant Operations and Services Agreement…**: Plutusone Hospitality Private Limited and…
- **2018-03-01 — Corporate Debtor…**: The Corporate Debtor allegedly owed Rs.…

## 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)

---

This is a preview. The full structured summary, issues, precedents and source judgment are available on CaseEase - Legal Intelligence Simplified: https://caseease.in/cases/ibc/nclt-chandigarh/busabong-co-private-limited-cp-no-4395-ibc-mb-2019-13e7fa8a