# In the matter of Jarvis Infratech Pvt. Ltd. IB-2354-ND-2019

> NCLT judgment dated 2020-02-10. Citation: TCN-2020-NCLT-02021. The applicant/Financial Creditor filed an application under Section 7 of the Insolvency &…

- **Court:** NCLT
- **Order date:** 10 Feb 2020
- **Citation:** TCN-2020-NCLT-02021
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/jarvis-infratech-pvt-ltd-ib-2354-nd-2019-47074f55

## Summary

### Background

The applicant/Financial Creditor filed an application under Section 7 of the Insolvency & Bankruptcy Code, 2016, to initiate corporate insolvency resolution process against the Respondent/Corporate Debtor. The applicant claimed Rs. 69,00,000/-. The Corporate Debtor filed a reply. The Financial Creditor submitted that the Corporate Debtor had entered into an agreement with the Financial Creditor, and an over-draft facility of Rs. 69 Lakhs was sanctioned to the Corporate Debtor.

## Facts

Noble Cooperative Bank Ltd. filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Jarvis Infratech Pvt Ltd, seeking to initiate the Corporate Insolvency Resolution Process (CIRP). The applicant claimed Rs. 69,00,000/- from the corporate debtor. The corporate debtor had availed an over-draft facility of Rs. 69 Lakhs from the financial creditor, sanctioned on 18.02.2018 at a simple interest rate of 13% per annum. The total outstanding amount was Rs. 76,54,410/-. The corporate debtor admitted to the debt and expressed willingness to repay but cited financial crisis as the reason for non-payment. The Adjudicating Authority found that the corporate debtor had defaulted on payments exceeding the minimum threshold limit under the IBC, 2016.

## Issues and analysis

### Issue 1: Whether the application under Section 7 of the Insolvency and Bankruptcy Code, 2016, should be …

**Ratio:** Section 7 of the IBC, 2016 allows a financial creditor to initiate CIRP against a

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**Reasoning:** The court considered the submissions of both parties and the averments made in the

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**Interpretation:** Section 7 provides the mechanism for a financial creditor to trigger the

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**Application:** The court applied Section 7 to the facts, noting the admission of debt and

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## Parties

- **Judges:** ABNI RANJAN KUMAR…; K.K. V…
- **Appellants:** Noble Cooperative…
- **Respondents:** Jarvis Infratech…

## Timeline

- **2018-02-18 — Over-draft Facility…**: An over-draft facility of Rs. 69 Lakhs was sanctioned to the Corporate Debtor at a simple…
- **2019-10-21 — Appearance before…**: The Corporate Debtor appeared before the Adjudicating Authority but was unable to repay…

## 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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