# In the matter of Dream Procon Pvt. Ltd. IB-1771(ND)-2018

> NCLT judgment dated 2019-09-06. Citation: TCN-2019-NCLT-01539. The case involves a petition filed by a Financial Creditor (Ms. Priyanshi Arora) under Section…

- **Court:** NCLT
- **Order date:** 6 Sept 2019
- **Citation:** TCN-2019-NCLT-01539
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/dream-procon-pvt-ltd-ib-1771nd-2018-a3f4f33e

## Summary

### Background

The case involves a petition filed by a Financial Creditor (Ms. Priyanshi Arora) under Section 7 of the Insolvency and Bankruptcy Code, 2016, against M/s Dream Procon Pvt. Ltd., the Corporate Debtor. The Financial Creditor and Corporate Debtor entered into an agreement in 2015 for Rs. 40,00,000, which was to be returned after one year with interest. The Corporate Debtor also provided a residential property as security. The Corporate Debtor made payments until 2016 but subsequently defaulted. An Article of Agreement was entered into in 2017, allotting a property to the Financial Creditor. The Corporate Debtor failed to complete the development and construction of the flats within the agreed timeframe. The Corporate Debtor claims it was unable to complete the project due

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## Facts

Ms. Priyanshi Arora, the Financial Creditor, filed a petition against M/s Dream Procon Pvt. Ltd., the Corporate Debtor, under Section 7 of the Insolvency and Bankruptcy Code, 2016. In 2015, the Financial Creditor and Corporate Debtor entered into an agreement for Rs. 40,00,000, to be returned after one year with interest. A residential property was provided as security. Payments were made until 2016, after which the Corporate Debtor defaulted. In 2017, an Article of Agreement was made, allotting a property to the Financial Creditor. The total debt payable by the Corporate Debtor was Rs. 48,04,700 as of 21.11.2018, with 24% annual interest. The Corporate Debtor was required to complete the development and construction of flats within 30 months, with a possible

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor committed a default in relation to the claim made by the Financial …

**Ratio:** The ratio is based on Section 7 of the Insolvency and Bankruptcy Code, 2016, which allows

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**Reasoning:** The Tribunal reasoned that the Corporate Debtor failed to repay the amount as agreed and

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**Interpretation:** The interpretation of Section 7 of the IBC, 2016, and the Supreme Court's

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**Application:** The Tribunal applied the ratio and reasoning to the facts of the case, noting

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## Parties

- **Judges:** R. VARADH…; K.K. V…
- **Appellants:** Ms.Priyansh…
- **Respondents:** M/s Dream Procon…

## Timeline

- **2015-01-01 — Agreement between FC…**: The Financial Creditor and Corporate Debtor entered into an agreement for Rs. 40,00,000,…
- **2016-01-01 — Default…**: The Corporate Debtor defaulted on…

## 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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