# In the matter of Isolux Corsan India Engineering & Construciton Pvt. Ltd.  & Ors. CP (IB) No.97-Chd-Hry-2018

> NCLT judgment dated 2018-10-11. Citation: TCN-2018-NCLT-00597. Oriental Bank of Commerce filed an application under Section 7 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 11 Oct 2018
- **Citation:** TCN-2018-NCLT-00597
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/isolux-corsan-india-engineering-construciton-pvt-ltd-ors-cp-ib-no97-chd-hry-2018-09e5ad90

## Summary

### Background

Oriental Bank of Commerce filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate the insolvency resolution process against Isolux Corsan India Engineering & Construction Pvt. Ltd. The bank, claiming to be a financial creditor, sought to recover outstanding dues. The corporate debtor was granted fund-based financial facilities amounting to ₹350 crores, later reduced to ₹280 crores. The corporate debtor defaulted on payments, leading to the classification of its account as NPA. The petitioner amended the petition to incorporate necessary details and provided documents to support the application. The corporate debtor acknowledged the default but cited insolvency of its shareholders as the reason for its inability to meet obligations.

## Facts

Oriental Bank of Commerce, a financial creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Isolux Corsan India Engineering & Construction Pvt. Ltd., the corporate debtor. The corporate debtor was granted fund-based financial facilities totaling ₹350 crores, later reduced to ₹280 crores. These facilities included term loans, cash credit, and bank guarantee limits. The corporate debtor executed various security documents, including agreements for term loans, hypothecation of assets, and counter-guarantee agreements. The last payment towards the loan was made on 09.05.2017, after which the loan was not serviced, and the account was classified as NPA on 31.08.2017. A demand notice under Section 13(2) of the SARFAESI Act

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## Issues and analysis

### Issue 1: Whether the application filed by the financial creditor, Oriental Bank of Commerce, under Section 7 …

**Ratio:** Section 7 of the Insolvency and Bankruptcy Code, 2016 allows a financial creditor to

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**Reasoning:** The court reasoned that the financial creditor had submitted sufficient evidence to

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

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

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## Parties

- **Judges:** R.P.Nag…; Pradeep R.…
- **Appellants:** Oriental Bank of…
- **Respondents:** Isolux Corsan…

## Timeline

- **1980-04-15 — Incorporation of…**: Oriental Bank of…
- **2003-09-04 — Power of At…**: Oriental Bank of Commerce issued a Power of…

## 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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