# In the matter of Evans Fraser and Co. (India) Ltd. CP-508-I&BP-NCLT-MAH-2018

> NCLT judgment dated 2018-09-05. Citation: TCN-2018-NCLT-00820. State Bank of India filed a Company Petition under Section 7 of the Insolvency & Bankruptcy…

- **Court:** NCLT
- **Order date:** 5 Sept 2018
- **Citation:** TCN-2018-NCLT-00820
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/evans-fraser-and-co-india-ltd-cp-508-ibp-nclt-mah-2018-9e673870

## Summary

### Background

State Bank of India filed a Company Petition under Section 7 of the Insolvency & Bankruptcy Code, 2016 (IBC) against Evans Fraser and Co. (India) Ltd., the Corporate Debtor, to initiate Corporate Insolvency Resolution Process (CIRP). The petition was based on the Corporate Debtor's default in making payment of ₹456.90 crores under the Rupee Term Loan Agreements (RTL) as of December 31, 2017. The petitioner argued that the Corporate Debtor is jointly and severally liable as Obligor/Co-obligor with 12 other Videocon group companies to repay the loan granted under RTL. The petitioner also stated that State Bank of Hyderabad, State Bank of Mysore, State Bank of Travancore, State Bank of Bikaner and Jaipur, and State Bank of Punjab were merged into State Bank of India

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## Facts

State Bank of India (SBI), acting as the Financial Creditor, filed a petition under Section 7 of the Insolvency & Bankruptcy Code, 2016 (IBC) against Evans Fraser and Co. (India) Ltd., the Corporate Debtor, seeking to initiate the Corporate Insolvency Resolution Process (CIRP). The basis for the petition was the Corporate Debtor's default in payment of ₹456.90 crores under Rupee Term Loan Agreements (RTL) as of December 31, 2017. The Corporate Debtor was allegedly jointly and severally liable as an Obligor/Co-obligor with 12 other Videocon group companies. The loans were originally granted and disbursed by State Bank of Hyderabad (SBH), State Bank of Mysore (SBM), State Bank of Travancore (SBT), State Bank of Bikaner and Jaipur (SBBJ), and State Bank of Punjab

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## Issues and analysis

### Issue 1: Whether the petition under Section 7 of the IBC is maintainable against the Corporate Debtor, Evans …

**Ratio:** The principle of joint and several liability under contract law and the definition of

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**Reasoning:** The NCLT reasoned that the RTL Agreement entered between the Banks and the specified

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**Interpretation:** The interpretation of the RTL agreement and the definition of 'debt' under IBC

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**Application:** The NCLT applied the principle of joint and several liability to the facts,

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## Parties

- **Judges:** B.S.V. Prakash…; Ravikumar…; +1 more
- **Appellants:** State Bank of…
- **Respondents:** Evans Fraser and…

## Timeline

- **2012-08-08 — Rupee Term Loan (RTL)…**: The Rupee Term Loan (RTL) Agreement was dated 8.8.2012, where the Corporate Debtor along…
- **2017-01-27 — Notice to Video…**: Notice dated 27.1.2017 by the applicant to the head of Videocon Group informing that the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 3(11) — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-3)

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