# In the matter of Oasis Textiles Ltd. CP (IB) No. 27-7-NCLT-AHM-2017

> NCLT judgment dated 2017-05-31. Citation: TCN-2017-NCLT-00833. Jhaveri Trading & Investment Pvt. Ltd. filed a petition under Section 7 of the Insolvency and…

- **Court:** NCLT
- **Order date:** 31 May 2017
- **Citation:** TCN-2017-NCLT-00833
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/oasis-textiles-ltd-cp-ib-no-27-7-nclt-ahm-2017-84470bee

## Summary

### Background

Jhaveri Trading & Investment Pvt. Ltd. filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, seeking reliefs under Section 7(5)(a) and Section 13(1)(a)(b)(c) of the Code. The case involves a financial debt owed by Oasis Textiles Ltd. to Jhaveri Trading & Investment Pvt. Ltd. arising from an Inter Corporate Deposit agreement.

## Facts

Jhaveri Trading & Investment Pvt. Ltd. (JTIPL) filed a petition against Oasis Textiles Ltd. under Section 7 of the Insolvency and Bankruptcy Code, 2016. Oasis Textiles Ltd. borrowed Rs. 1,23,50,000 from JTIPL via an Inter Corporate Deposit, with an agreement dated 2017-03-09. The repayment schedule included installments due on 2017-04-08, 2017-05-08, and 2017-06-07, with interest at 12% per annum. Oasis Textiles also executed a demand promissory note dated 2017-03-10. JTIPL provided evidence of the debt through bank statements. Oasis Textiles requested JTIPL not to transfer a cheque dated 2017-04-08. JTIPL issued a notice on 2017-05-09 demanding repayment, which Oasis Textiles failed to honor. JTIPL proposed Mr. Umesh Harjivandas Ved as the Interim Resolution

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## Issues and analysis

### Issue 1: Whether Oasis Textiles Ltd. committed a default in repayment of the financial debt owed to Jhaveri …

**Ratio:** A default occurs when a corporate debtor fails to repay a financial debt to a financial

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**Reasoning:** The court noted the Inter Corporate Deposit Agreement, demand promissory note, and bank

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**Interpretation:** The Insolvency and Bankruptcy Code defines 'default' as the non-payment of debt

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**Application:** Oasis Textiles Ltd. failed to repay the loan amount as per the agreed schedule,

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## Parties

- **Judges:** BIKKI RAVEENDRA…
- **Appellants:** Jhaveri Trading &…
- **Respondents:** Oasis Textiles…

## Timeline

- **2016-01-01 — Enactment…**: The Insolvency and…
- **2017-03-09 — Inter Corporate Deposit…**: Jhaveri Trading & Investment Pvt. Ltd. and Oasis Textiles Ltd. enter into an Inter…

## 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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