# In the matter of Eastern Gases Ltd. CP (IB) No. 482-KB-2017

> NCLT judgment dated 2017-11-08. Citation: TCN-2017-NCLT-00228. ICICI Bank Ltd. filed an application under Section 7 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 8 Nov 2017
- **Citation:** TCN-2017-NCLT-00228
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/eastern-gases-ltd-cp-ib-no-482-kb-2017-d7d2016f

## Summary

### Background

ICICI Bank Ltd. filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate corporate insolvency resolution process against Eastern Gases Ltd., the corporate debtor. The application was filed due to the corporate debtor's failure to pay a debt of Rs. 21,34,69,146.42. The corporate debtor had availed financial assistance from the applicant bank, including working capital and overdraft facilities. The applicant bank recalled the loan and issued a recall notice, but the corporate debtor failed to repay the dues. The corporate debtor had also filed proceedings against the applicant bank in the Civil Court and the High Court, challenging the classification of the loan account. The corporate debtor argued that the financial creditor had

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## Facts

ICICI Bank Ltd. filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate corporate insolvency resolution process against Eastern Gases Ltd. The corporate debtor, Eastern Gases Ltd., had availed financial assistance from ICICI Bank, including working capital and overdraft facilities. The corporate debtor defaulted on a payment of Rs. 21,34,69,146.42. ICICI Bank recalled the loan by issuing a recall notice dated 8/5/2017 along with an addendum dated 6/9/2017. The corporate debtor had filed proceedings against ICICI Bank in the Civil Court and the High Court, challenging the classification of the loan account. The corporate debtor approached the financial creditor for an overdraft and fund-based limit of Rs. 11.95 crore, which was

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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 Adjudicating Authority considered the documents filed by the financial creditor,

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**Interpretation:** Section 7 of the IBC provides a mechanism for financial creditors to recover

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**Application:** In this case, the financial creditor, ICICI Bank, filed an application under

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## Parties

- **Judges:** V. P. S…; Jinan…
- **Appellants:** ICICI Ban…
- **Respondents:** Eastern Gas…
- **Advocates:** Joy S…; Avishak…; +2 more

## Timeline

- **2015-04-30 — Sanction…**: Financial creditor sanctioned Rs.11.95 crore as fund based credit facility to the…
- **2015-12-01 — Request for En…**: Corporate debtor requested for enhancement of working capital limit from Rs.11.95 crore…

## 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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