# In the matter of Devesh Engineering Enterprises Private Limited CP (IB) No. 232-7-HDB-2020

> NCLT judgment dated 2021-02-19. Citation: TCN-2021-NCLT-02986. The case involves an application filed under Section 7 of the Insolvency and Bankruptcy Code…

- **Court:** NCLT
- **Order date:** 19 Feb 2021
- **Citation:** TCN-2021-NCLT-02986
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/devesh-engineering-enterprises-private-limited-cp-ib-no-232-7-hdb-2020-139f1a15

## Summary

### Background

The case involves an application filed under Section 7 of the Insolvency and Bankruptcy Code (IBC) by Tejaswini Engineering Private Limited (Financial Creditor) against Devesh Engineering Enterprises (P) Limited (Corporate Debtor) to initiate Corporate Insolvency Resolution Process (CIRP). The Corporate Debtor allegedly defaulted on a financial debt of Rs. 11,31,65,339/- as of 01.01.2018.

## Facts

Tejaswini Engineering Private Limited (Financial Creditor) filed an application under Section 7 of the IBC to initiate CIRP against Devesh Engineering Enterprises (P) Limited (Corporate Debtor). The Financial Creditor claimed that a loan agreement dated 01.01.2018 granted Rs. 8,84,10,421/- as an unsecured loan to the Corporate Debtor, to be repaid in eight installments of Rs. 1,10,51,303/- every three months. The Corporate Debtor allegedly defaulted on the repayment. The Corporate Debtor admitted to the debt in their reply affidavit. The outstanding debt exceeded Rs. 1,00,000/-. The Financial Creditor proposed Mr. Bhaskar B as the IRP.

## Issues and analysis

### Issue 1: Whether the application under Section 7 of the IBC for initiating CIRP against the Corporate Debtor …

**Ratio:** Section 7 of the IBC allows a financial creditor to initiate CIRP against a corporate

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**Reasoning:** The court considered the application, the Corporate Debtor's reply, and the evidence

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**Interpretation:** Section 7 provides the mechanism for financial creditors to trigger the

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**Application:** The court applied Section 7 to the facts, noting the admitted debt and the

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## Parties

- **Judges:** Madan B.…; BINOD KUMAR…
- **Appellants:** Tejaswini…
- **Respondents:** Devesh Engineering…; Devesh Engineering…

## Timeline

- **2018-01-01 — Loan Agreeme…**: Loan agreement between Tejaswini Engineering Private Limited and Devesh Engineering…
- **2018-01-01 — Default…**: Alleged date of default by Devesh Engineering Enterprises (P) Limited on the financial…

## 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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