# In the matter of Shree Aashraya Infra-con Ltd.

> NCLT judgment dated 2021-04-06. Citation: TCN-2021-NCLT-02467. The case involves a petition filed by Shree Ashraya Souhard Credit Society Ltd. under Section 7…

- **Court:** NCLT
- **Order date:** 6 Apr 2021
- **Citation:** TCN-2021-NCLT-02467
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/shree-aashraya-infra-con-ltd-f72254c8

## Summary

### Background

The case involves a petition filed by Shree Ashraya Souhard Credit Society Ltd. under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Shree Ashraya Infra-Con Ltd. The petitioner claims that the corporate debtor has defaulted on a total amount of Rs. 12,09,45,192/- as of March 31, 2020. The petitioner is a Co-operative Society registered under the Karnataka Co-operative Societies Act, 1959, later renamed 'Shree Ashraya Souhard Credit Society Limited' under the Karnataka Souharda Sahakari Act, 1997. The respondent is engaged in the business of Real Estate and Construction, initially a Partnership Firm under the name 'Ashraya Constructions' and later converted into a Public Limited

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## Facts

Shree Ashraya Souhard Credit Society Ltd. (Petitioner), a cooperative society, filed C.P. (IB) No.196/BB/2020 under Section 7 of IBC, 2016, against Shree Ashraya Infra-Con Ltd. (Respondent/Corporate Debtor) seeking initiation of CIRP. The petitioner claimed a default of Rs. 12,09,45,192/- as of 31.03.2020. The petitioner had provided a secured cash credit facility of Rs. 14 Cr to the respondent before its conversion from a partnership to a public limited company. The respondent obtained four cash credit facilities between 2000 and 2010. The petitioner issued a notice dated 01.03.2018 for payment, which was returned undelivered on 10.03.2018. The petitioner's depositors approached the Registrar of Co-operative Society expressing grievances. The petitioner is in

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor committed a default in repaying the financial debt owed to the …

**Ratio:** Section 7 of the IBC, 2016 allows a financial creditor to initiate CIRP against a

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**Reasoning:** The NCLT reasoned that the Respondent had acknowledged the due amounts to be payable in

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**Interpretation:** The interpretation of Section 7 of the IBC, 2016, is that a financial creditor

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**Application:** In this case, the NCLT applied the ratio to the facts and found that the

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## Parties

- **Judges:** Rajeswara Rao…; Ashutosh C…
- **Appellants:** Shree Ashraya…
- **Respondents:** Shree Ashraya…

## Timeline

- **1959-01-01 — Registration of…**: The Petitioner was registered as a Co-operative Society under the Karnataka Co-operative…
- **1997-01-01 — Change of…**: The Petitioner got registered under Karnataka Souharda Sahakari Act, 1997 and changed its…

## 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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