# In the matter of Talwalkars Healthclubs Limited CP (IB) 923-MB-C-II-2020

> NCLT judgment dated 2021-03-09. Citation: TCN-2021-NCLT-02765. Axis Bank Limited filed a Company Petition under Section 7 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 9 Mar 2021
- **Citation:** TCN-2021-NCLT-02765
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/talwalkars-healthclubs-limited-cp-ib-923-mb-c-ii-2020-6f9422d1

## Summary

### Background

Axis Bank Limited filed a Company Petition under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) to initiate Corporate Insolvency Resolution Process (CIRP) against Talwalkars Healthclubs Limited, the Corporate Debtor. The petition was filed on March 3, 2020, before the Adjudicating Authority, alleging that the Corporate Debtor failed to make payment of the total outstanding sum of Rs. 1,57,84,25,009.33, including accrued interest as of January 31, 2020. The outstanding amount comprised Rupee Term Loans, Debenture Trust Deeds (DTDs), and vendor financing.

## Facts

Axis Bank Limited, the Financial Creditor, filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) to initiate Corporate Insolvency Resolution Process (CIRP) against Talwalkars Healthclubs Limited, the Corporate Debtor. The Corporate Debtor is a private company incorporated on April 23, 2016. The petition was filed on March 3, 2020, claiming a total outstanding amount of Rs. 1,57,84,25,009.33 as of January 31, 2020. This amount includes Rs. 62,28,72,603.86 in Rupee Term Loans, Rs. 90,25,06,045.00 under Debenture Trust Deeds (DTDs), and Rs. 5,30,46,360.48 under vendor financing. The dates of default for Rupee Term Loans, DTDs, and vendor financing were August 29, 2019, September 4, 2019, and August 10, 2019, respectively. The Financial

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor is in default of a …

**Ratio:** Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) allows a financial creditor

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**Reasoning:** The Adjudicating Authority found that the Corporate Debtor failed to make payments of the

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**Interpretation:** Section 7 of the IBC provides the mechanism for a financial creditor to trigger

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**Application:** The Corporate Debtor's failure to pay the outstanding amounts under the loan

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## Parties

- **Judges:** Harihar Prakash…; RavikumarDu…
- **Appellants:** Axis Bank L…
- **Respondents:** Talwalkars…

## Timeline

- **2016-04-23 — Incorporation of…**: Talwalkars Healthclubs Limited…
- **2016-10-03 — Sanction…**: Financial Creditor granted…

## 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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