# In the matter of Kingiree Fashion Pvt. Ltd. C.P. (IB) No. 1049-KB-2018

> NCLT judgment dated 2019-02-04. Citation: TCN-2019-NCLT-05037. Reliance Commercial Finance Ltd. filed an application under Section 7 of the Insolvency and…

- **Court:** NCLT
- **Order date:** 4 Feb 2019
- **Citation:** TCN-2019-NCLT-05037
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/kingiree-fashion-pvt-ltd-cp-ib-no-1049-kb-2018-54783359

## Summary

### Background

Reliance Commercial Finance Ltd. filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Kingiree Fashion Pvt. Ltd. The application was based on the Corporate Debtor's failure to repay a loan amount of Rs. 50,46,397, advanced as per a Loan Cum Hypothecation Agreement dated 2014-05-28. The Financial Creditor claimed default based on an Arbitral Award dated 2018-03-13.

## Facts

Reliance Commercial Finance Ltd. (Financial Creditor) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Kingiree Fashion Pvt. Ltd. (Corporate Debtor). The Corporate Debtor had taken a loan of Rs. 50,00,000 from the Financial Creditor, as per a Loan Cum Hypothecation Agreement dated 2014-05-28. The loan was to be repaid in 119 monthly installments. The Corporate Debtor defaulted on the repayment. The Financial Creditor issued a Loan Recall Notice dated 2017-06-13. The matter was referred to arbitration, and an award was passed in favor of the Financial Creditor on 2018-03-13. Despite the award, the Corporate Debtor failed to comply. The Corporate Debtor challenged the

…

## Issues and analysis

### Issue 1: Whether the application filed by the Financial Creditor under Section 7 of the Insolvency and …

**Ratio:** The pendency of an arbitration proceeding is no bar to the admission of a Section 7

…

**Reasoning:** The NCLT relied on the Supreme Court's judgment in K. Kishan v. M/S Vijay Nirman Company

…

**Interpretation:** Section 7 of the I&B Code requires the existence of a debt and a default.

…

**Application:** In this case, the Corporate Debtor had defaulted on the loan repayment, and the

…

## Parties

- **Judges:** Jinan…
- **Appellants:** Reliance Commercia…
- **Respondents:** Kingiree Fashion…

## Timeline

- **2014-05-28 — Loan Agre…**: Corporate Debtor executed a Loan Agreement with Reliance Capital Limited for Rs.…
- **2017-06-13 — Loan Recall…**: Financial Creditor issued a Loan…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

---

This is a preview. The full structured summary, issues, precedents and source judgment are available on CaseEase - Legal Intelligence Simplified: https://caseease.in/cases/ibc/nclt-chandigarh/kingiree-fashion-pvt-ltd-cp-ib-no-1049-kb-2018-54783359