# In the matter of KDJ Holidayscapes and Resorts Limited C.P. (IB) No. 2459-NCLT-MB-2019

> NCLT judgment dated 2019-09-23. Citation: TCN-2019-NCLT-01306. TJSB Sahakari Bank Limited, the Financial Creditor/Applicant, filed an application under…

- **Court:** NCLT
- **Order date:** 23 Sept 2019
- **Citation:** TCN-2019-NCLT-01306
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/kdj-holidayscapes-and-resorts-limited-cp-ib-no-2459-nclt-mb-2019-e14f7555

## Summary

### Background

TJSB Sahakari Bank Limited, the Financial Creditor/Applicant, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 (I&B Code) against KDJ HOLIDAYSCAPES AND RESORTS LIMITED, the Corporate Debtor, for initiating Corporate Insolvency Resolution Process (CIRP). The application was filed due to a default of ₹5,46,34,862/- along with interest as on 31.03.2019.

## Facts

TJSB Sahakari Bank Limited sanctioned a cash credit facility of ₹3,25,00,000/- to KDJ HOLIDAYSCAPES AND RESORTS LIMITED. A facility agreement was entered into on 17.12.2013, along with a deed of hypothecation. The credit facility was repayable on demand or at the expiry of 365 days from the first withdrawal. The account of the Corporate Debtor was classified as a Non-Performing Asset (NPA) on 03.12.2015. The Applicant issued a Show Cause Notice dated 07.08.2018 for declaring the Corporate Debtor and its Directors as Wilful Defaulters. The Corporate Debtor admitted the debt and default and requested more time to repay. The total default claimed was ₹5,46,34,862/- as of 31.03.2019. The Corporate Debtor passed a Board Resolution on 27.11.2013 accepting the credit facility.

## Issues and analysis

### Issue 1: Whether the application under Section 7 of the I&B Code, 2016 for initiating Corporate …

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

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**Reasoning:** The NCLT examined the application and the documents submitted by the Applicant and found

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

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**Application:** The application was found to be complete as it contained all the necessary

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## Parties

- **Judges:** Mr V.P.…; Mr Rajesh…; +1 more
- **Appellants:** TJSB Sahakari…
- **Respondents:** KDJ HOLIDAYSCAPES…; KDJ Holidayscapes…

## Timeline

- **2013-11-25 — Disbursement Order and…**: Applicant sanctioned a loan…
- **2013-12-17 — Facility Ag…**: Applicant and Corporate Debtor…

## 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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