# In the matter of Sparkspell Homes Pvt. Ltd. Company Petition (IB)No.76-ALD-2019

> NCLT judgment dated 2019-08-28. Citation: TCN-2019-NCLT-01715. The case involves a petition filed by Deepak Gupta HUF, the financial creditor, against M/s…

- **Court:** NCLT
- **Order date:** 28 Aug 2019
- **Citation:** TCN-2019-NCLT-01715
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/sparkspell-homes-pvt-ltd-company-petition-ibno76-ald-2019-a1c04796

## Summary

### Background

The case involves a petition filed by Deepak Gupta HUF, the financial creditor, against M/s Sparkspell Homes Pvt. Ltd., the corporate debtor, under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016. The financial creditor sought to initiate the Corporate Insolvency Resolution Process (CIRP) against the corporate debtor, claiming to be a financial creditor within the meaning of Section 5(7) of the IBC. The financial creditor and corporate debtor entered into two agreements where the corporate debtor agreed to pay Rs. 80,00,000 with an interest rate of 4.26% per month. The corporate debtor defaulted on payments, leading to dishonored cheques and subsequent legal action.

## Facts

Deepak Gupta HUF, acting as the financial creditor, filed a petition against M/s Sparkspell Homes Pvt. Ltd., the corporate debtor, under Section 7 of the IBC. Two agreements were entered into between the parties, where the corporate debtor agreed to pay Rs. 80,00,000 with an interest rate of 4.26% per month. The corporate debtor failed to make payments as per the agreements, resulting in dishonored cheques. The financial creditor initiated legal action under Section 138 of the Negotiable Instruments Act. The total amount due from the corporate debtor was Rs. 5,86,94,399. The financial creditor presented bank statements and agreements as evidence of the financial debt. The corporate debtor did not appear despite the publication of notice in the newspaper. The financial

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## Issues and analysis

### Issue 1: Whether the application filed under Section 7 …

**Ratio:** The application under Section 7 of the IBC is deemed complete if it meets the

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**Reasoning:** The court found that the financial creditor had provided sufficient evidence, including

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**Interpretation:** Section 7 of the IBC allows a financial creditor to initiate CIRP against a

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**Application:** In this case, the court determined that the financial creditor's application

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## Parties

- **Judges:** ABNI RANJAN KUMAR…
- **Appellants:** Deepak Gupt…
- **Respondents:** M/s Sparkspell…
- **Advocates:** Sh. Yash…

## Timeline

- **2016-01-01 — Enactment…**: The Insolvency and…
- **2014-04-15 — Agreement…**: Two agreements were executed between the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 5(7) — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-5)

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