# in the matter of Tirupati Infraprojects Pvt. Ltd. CP No. IB-104-PB-2017

> NCLT judgment dated 2017-07-03. Citation: TCN-2017-NCLT-00765. Bank of India, as the lead bank of a consortium, filed an application under Section 7 of the…

- **Court:** NCLT
- **Order date:** 3 Jul 2017
- **Citation:** TCN-2017-NCLT-00765
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/tirupati-infraprojects-pvt-ltd-cp-no-ib-104-pb-2017-cc315697

## Summary

### Background

Bank of India, as the lead bank of a consortium, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Tirupati Infraprojects Pvt. Ltd., the Corporate Debtor. The Corporate Debtor had approached the Financial Creditor for a term loan facility of Rs. 70 Crores, part of a larger Rs. 300 Crores requirement for setting up a five-star hotel cum retail space. A term loan of Rs. 50 Crores was sanctioned in January 2009, secured by personal guarantees and a pari passu charge on project assets. The loan was to be repaid in quarterly installments commencing March 2011. The account became irregular due to non-servicing of interest, leading to restructuring in 2011 and 2013. Despite

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## Facts

Bank of India, acting as the lead bank for a consortium, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Tirupati Infraprojects Pvt. Ltd. Tirupati Infraprojects Pvt. Ltd. had approached Bank of India for a term loan of Rs. 70 Crores, which was part of a larger requirement of Rs. 300 Crores for establishing a five-star hotel cum retail space in New Delhi. Bank of India sanctioned a term loan of Rs. 50 Crores on January 19, 2009, with specific terms and conditions. The loan was secured by personal guarantees from the promoters and a first pari passu charge on the project assets, including the land measuring 3.25 acres. The repayment schedule stipulated 31 quarterly

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## Issues and analysis

### Issue 1: Whether the petitioner has been able to satisfy …

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

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**Reasoning:** The Tribunal noted that the petitioner, Bank of India, being the lead bank of the

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**Interpretation:** Section 7 provides the mechanism for a financial creditor to trigger the CIRP.

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**Application:** The Tribunal found that Bank of India, as the lead bank, had the authority to

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## Parties

- **Judges:** M. M. K…; DeepaKr…
- **Appellants:** Bank of…
- **Respondents:** Tirupati Infraproj…
- **Advocates:** Sanjay…; Naveen…; +4 more

## Timeline

- **2008-09-15 — Loan Appli…**: The 'Corporate Debtor' submitted a letter…
- **2009-01-19 — Sanction…**: The 'Financial Creditor' sanctioned a term loan of Rs. 50 Crores to the 'Corporate…

## 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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