# In the matter of J.R. Agrotech Pvt. Ltd. CP (IB) No. 46-Chd-Pb-2018

> NCLT judgment dated 2018-07-27. Citation: TCN-2018-NCLT-01055. Oriental Bank of Commerce filed a petition under Section 7 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 27 Jul 2018
- **Citation:** TCN-2018-NCLT-01055
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/jr-agrotech-pvt-ltd-cp-ib-no-46-chd-pb-2018-f44f3b28

## Summary

### Background

Oriental Bank of Commerce filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, against J.R.Agrotech Pvt. Ltd. for initiating the corporate insolvency resolution process. J.R.Agrotech had availed financial facilities from a consortium of banks, including Oriental Bank of Commerce. The account was classified as NPA due to defaults in payment. The corporate debtor argued that a restructuring proposal was under consideration and the petition was not maintainable. The petitioner contended that the restructuring proposal was not submitted within the stipulated time and that the RBI circulars cited by the corporate debtor were not applicable.

## Facts

Oriental Bank of Commerce (OBC) filed a petition under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016 against J.R.Agrotech Pvt. Ltd. OBC, as a financial creditor, sought to initiate the corporate insolvency resolution process (CIRP) due to defaults in loan repayment. J.R.Agrotech had availed financial facilities from a consortium of six banks, including OBC. The corporate debtor's account was classified as a Non-Performing Asset (NPA) on 30.08.2017. A common notice under Section 13(2) of the SARFAESI Act, 2002 was issued by the lead bank of the consortium on 27.11.2017, demanding ₹283,62,49,468.73. OBC's outstanding amount was ₹21,16,32,118 as of 31.10.2017. The corporate debtor argued that a restructuring proposal was under consideration and cited RBI

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## Issues and analysis

### Issue 1: Whether the petition under Section 7 of the Insolvency and Bankruptcy Code, 2016 is maintainable …

**Ratio:** Section 7 of the IBC allows a financial creditor to initiate CIRP if a default has

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**Reasoning:** The court found that the corporate debtor defaulted in payment, the application was

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**Interpretation:** Section 7 of the IBC provides a clear framework for initiating CIRP based on

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**Application:** The court applied Section 7 to the facts, finding that the conditions were met

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## Parties

- **Judges:** R.P.Nag…; Pradeep R.…
- **Appellants:** Oriental Bank of…
- **Respondents:** J.R.Agrotech Pvt.…; M/s J.R.Agrotech…

## Timeline

- **2016-01-01 — Corporate Debtor…**: J.R.Agrotech Pvt. Ltd. availed financial…
- **2016-03-31 — Cash Credit limit…**: Cash Credit limit of Rs.20 crores was…

## 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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