# In the matter of Genrx Pharmaceuticals Private Limited CP(IB)No. 4716-NCLT-MB-2018

> NCLT judgment dated 2020-01-22. Citation: TCN-2020-NCLT-02211. The case involves an application filed by Phoenix ARC Private Limited, an assignee of the…

- **Court:** NCLT
- **Order date:** 22 Jan 2020
- **Citation:** TCN-2020-NCLT-02211
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/genrx-pharmaceuticals-private-limited-cpibno-4716-nclt-mb-2018-14a47da1

## Summary

### Background

The case involves an application filed by Phoenix ARC Private Limited, an assignee of the original Financial Creditor, Janata Sahakari Bank Limited, against Genrx Pharmaceuticals Private Limited, the Corporate Debtor, under Section 7 of the Insolvency & Bankruptcy Code, 2016 (I&B Code). The application seeks to initiate the Corporate Insolvency Resolution Process (CIRP) due to a total default of financial debt amounting to ₹22,63,15,080 as of 12.12.2018. The Assignor Bank had extended various financial facilities to the Corporate Debtor, including term loans and cash credit facilities. The Corporate Debtor's loan account was classified as a Non-Performing Asset (NPA) on 28.10.2015.

## Facts

Phoenix ARC Private Limited, as the assignee of Janata Sahakari Bank Limited, filed an application under Section 7 of the I&B Code, 2016, to initiate CIRP against Genrx Pharmaceuticals Private Limited. The Corporate Debtor defaulted on a financial debt of ₹22,63,15,080 as of 12.12.2018. The Assignor Bank had extended financial facilities to the Corporate Debtor, including Term Loan I for ₹6 crore (dated 29.12.2011), Term Loan II for ₹1.5 crore (dated 28.03.2018), and Term Loan III for ₹8.5 crore (dated 12.10.2013). The Corporate Debtor executed several Demand Promissory Notes in favor of the Assignor Bank. The Corporate Debtor's loan account was classified as NPA on 28.10.2015. The Assignor Bank issued notices under Section 13(2) and 13(4) of the SARFAESI Act,

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## Issues and analysis

### Issue 1: Whether the application filed under Section 7 of the I&B Code, 2016, by Phoenix ARC Private …

**Ratio:** Section 7 of the I&B Code, 2016, allows a financial creditor to initiate CIRP against

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**Reasoning:** The NCLT perused the application and the documents submitted by Phoenix ARC Private

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**Interpretation:** Section 7 of the I&B Code is interpreted to mean that if a financial

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**Application:** In this case, Phoenix ARC Private Limited, as the assignee of the Financial

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## Parties

- **Judges:** Bhaskara Pantula…; RAJESH S…
- **Appellants:** Phoenix Arc…
- **Respondents:** Genrx Pharmaceutic…

## Timeline

- **2011-12-29 — Term Loan I A…**: Loan Agreement dated…
- **2018-03-28 — Term Loan II A…**: Loan Agreement dated…

## 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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This is a preview. The full structured summary, issues, precedents and source judgment are available on CaseEase - Legal Intelligence Simplified: https://caseease.in/cases/ibc/nclt-chandigarh/genrx-pharmaceuticals-private-limited-cpibno-4716-nclt-mb-2018-14a47da1