# In the matter of Dewa Projects Pvt. Ltd. IBA-23-KOB-2019

> NCLT judgment dated 2019-09-13. Citation: TCN-2019-NCLT-01462. The case involves an application filed under Section 7 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 13 Sept 2019
- **Citation:** TCN-2019-NCLT-01462
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/dewa-projects-pvt-ltd-iba-23-kob-2019-7456db7c

## Summary

### Background

The case involves an application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016, by financial creditors (home buyers) against Dewa Projects Private Limited, the corporate debtor. The financial creditors sought to initiate the Corporate Insolvency Resolution Process (CIRP) due to the corporate debtor's failure to complete a multi-storied residential complex named "DEWA PIER 20" and hand over possession of apartments as agreed. The financial creditors had entered into an Agreement for Sale with Ansu Enterprises Private Limited, which had a Development Agreement with the Corporate Debtor. The corporate debtor failed to repay a loan of Rs. 366.68 Crores, leading to SARFAESI proceedings initiated by a consortium of banks. The home-buyers formed

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## Facts

Rita Venugopal and Dr. K.S. Venugopal, the financial creditors/applicants, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Dewa Projects Pvt Ltd, the corporate debtor/respondent. The financial creditors are also home buyers. The corporate debtor was incorporated on 12.04.2005. The financial creditors entered into an Agreement for Sale dated 21.08.2013 with Ansu Enterprises Private Limited, which had a Development Agreement dated 31.07.2010 with the Corporate Debtor. The Corporate Debtor proposed to construct a multi-storied residential complex named "DEWA PIER 20". The financial creditors approached Ansu Enterprises for the purchase of undivided shares in the property. The total consideration payable for the property

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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 NCLT perused the records submitted by the financial creditor and found that the

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

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**Application:** In this case, the financial creditors demonstrated that Dewa Projects Private

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## Parties

- **Judges:** Ashok Kumar…; Veera Brahma Rao…
- **Appellants:** Rita Venu…
- **Respondents:** Dewa Projects Pvt…

## Timeline

- **2005-04-12 — Incorporation of…**: Dewa Projects Private…
- **2010-07-31 — Development A…**: M/s Ansu Enterprises entered into a…

## 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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