# In the matter of Imeco Limited CP(IB)No .892-KB-2018

> NCLT judgment dated 2019-08-29. Citation: TCN-2019-NCLT-01700. Borojalingah Tea Company, the Financial Creditor, filed an application under Section 7 of the…

- **Court:** NCLT
- **Order date:** 29 Aug 2019
- **Citation:** TCN-2019-NCLT-01700
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/imeco-limited-cpibno-892-kb-2018-a0c9f639

## Summary

### Background

Borojalingah Tea Company, the Financial Creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Imeco Limited, the Corporate Debtor, to initiate the Corporate Insolvency Resolution Process (CIRP). The Corporate Debtor allegedly defaulted in paying a financial debt of Rs. 7,59,136/-. The Financial Creditor disbursed a loan of Rs. 10,00,000/- to the Corporate Debtor on 02.04.2018, at an interest rate of 12% per annum, with an agreement to repay within 180 days, which was not fulfilled.

## Facts

Borojalingah Tea Company, a Financial Creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Imeco Limited, the Corporate Debtor. The Financial Creditor claimed that the Corporate Debtor defaulted on a financial debt of Rs. 7,59,136/-. On 02.04.2018, the Financial Creditor disbursed a loan of Rs. 10,00,000/- to the Corporate Debtor at an interest rate of 12% per annum, with a repayment agreement within 180 days. The Corporate Debtor failed to repay the loan as agreed. The Corporate Debtor, represented by Mr. Ramesh Kr. Sharma, denied the liability and claimed no default. The Financial Creditor produced evidence of the debt, including a disbursement letter dated

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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 court found that the Financial Creditor had provided sufficient evidence of the debt

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**Interpretation:** Section 7 provides a mechanism for financial creditors to recover their dues

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**Application:** The court applied Section 7 to the facts of the case, finding that the

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## Parties

- **Judges:** Madan B.…; Virendra Kumar…
- **Appellants:** Borojalingah Tea…
- **Respondents:** IMECO Li…

## Timeline

- **2018-04-02 — Loan Disbur…**: The Financial Creditor disbursed a loan of…
- **2018-04-03 — Acknowledgment…**: Corporate Debtor executed acknowledgment…

## 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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