# In the matter of Drishti India Limited C.P. No. IB-354 (PB)-2021

> NCLT judgment dated 2021-11-01. Citation: TCN-2021-NCLT-00645. The application was filed under Section 7 of the Insolvency and Bankruptcy Code, 2016, by…

- **Court:** NCLT
- **Order date:** 1 Nov 2021
- **Citation:** TCN-2021-NCLT-00645
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/drishti-india-limited-cp-no-ib-354-pb-2021-13fc0c4f

## Summary

### Background

The application was filed under Section 7 of the Insolvency and Bankruptcy Code, 2016, by Manish Kumar and his wife, Renu Meena, to initiate the Corporate Insolvency Resolution Process (CIRP) against M/s. Drishti India Limited. The applicants claimed that they had provided a loan to the corporate debtor, which was not repaid. The corporate debtor argued that the amount was not a loan but a security deposit for a development agreement and that the application was not maintainable.

## Facts

Manish Kumar and Renu Meena filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate CIRP against Drishti India Limited, claiming to be financial creditors. The applicants had obtained a loan of Rs. 2 crores against their house, out of which Rs. 1.90 crores were transferred to Renu Meena's account and then to the corporate debtor's account on 2011-12-15. The applicants claimed this was a loan with a 24% interest rate. The corporate debtor contended that the amount was not a loan but a security deposit for a development agreement with Saj Housing Private Limited, where the corporate debtor allotted land. The corporate debtor argued that the applicants were aware of this agreement and that the amount was consideration for development

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## Issues and analysis

### Issue 1: Whether the amount transferred by the applicants to the corporate debtor constitutes a 'financial …

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

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**Reasoning:** The court considered the arguments of both parties regarding the nature of the

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**Interpretation:** The court interpreted the definition of 'financial debt' under Section 5(8) of

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**Application:** The court found that the amount was reflected as a long-term borrowing in the

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## Parties

- **Judges:** Bhaskara Pantula…; HEMANT KUMAR…
- **Appellants:** Manish…
- **Respondents:** Drishti India…

## Timeline

- **1994-07-27 — Incorporation of…**: Drishti India Limited incorporated…
- **1994-10-28 — Allotment o…**: Municipal corporation of Faridabad…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 5(7) — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-5)

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