# In the matter of RNB Cements Pvt. Ltd. Dy. No. 3(211) of 2018 in CP (IB) No. 18-GB-2019

> NCLT judgment dated 2019-06-13. Citation: TCN-2019-NCLT-02935. The financial creditor, Bank of India, filed an application under Section 7 of the Insolvency…

- **Court:** NCLT
- **Order date:** 13 Jun 2019
- **Citation:** TCN-2019-NCLT-02935
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/rnb-cements-pvt-ltd-dy-no-3211-of-2018-in-cp-ib-no-18-gb-2019-36700745

## Summary

### Background

The financial creditor, Bank of India, filed an application under Section 7 of the Insolvency & Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against M/s. RNB Cements (P) Ltd. due to an alleged default in repayment of loans. The corporate debtor did not contest the application despite receiving notice and multiple opportunities to file a reply affidavit.

## Facts

Bank of India, the financial creditor, filed an application under Section 7 of the Insolvency & Bankruptcy Code, 2016, read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against M/s. RNB Cements Pvt. Ltd., the corporate debtor. The financial creditor claimed an outstanding amount of Rs.22,59,77,397.10 due from the corporate debtor, which failed to repay the debt despite demand. The financial creditor had sanctioned and disbursed Term Loan-I of Rs.7.00 crores and Term Loan-II of Rs.7.80 crores, totaling Rs.14.80 crores. These loans were part of a consortium arrangement where State Bank of India was the lead bank, and other banks like Indian Bank and

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## Issues and analysis

### Issue 1: Whether the financial creditor has complied with all the requirements under Section 7 of the …

**Ratio:** An application under Section 7 of the IBC, 2016, can be admitted if the financial

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**Reasoning:** The NCLT verified the application and found that the financial creditor had submitted all

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**Interpretation:** The court interpreted **Section 7 (5)** of the Code, which states that if the

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**Application:** The financial creditor, Bank of India, provided sufficient documentary evidence

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## Parties

- **Judges:** Jinan…
- **Appellants:** Bank of…
- **Respondents:** RNB Cements (P)…; M/s. RNB Cements…
- **Advocates:** For the Financial…

## Timeline

- **June 30, 2014 — Default in loan…**: The corporate debtor committed…
- **August 31, 2014 — Default in loan…**: The corporate debtor committed…

## 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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