# In the matter of Unishire LLP C.P. (IB) No. 172-BB-2019

> NCLT judgment dated 2019-07-31. Citation: TCN-2019-NCLT-02192. M/s. VSL Securities Private Limited filed C.P. (IB) No.172/BB/2019 under Section 7 of the…

- **Court:** NCLT
- **Order date:** 31 Jul 2019
- **Citation:** TCN-2019-NCLT-02192
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/unishire-llp-cp-ib-no-172-bb-2019-9c7cbd39

## Summary

### Background

M/s. VSL Securities Private Limited filed C.P. (IB) No.172/BB/2019 under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against M/s. Unishire Housing LLP, the Corporate Debtor. The claim is based on a default of Rs.21,58,04,027.39/-, which includes a principal amount of Rs.12,94,00,000/- and interest of Rs.8,64,04,027.39/- at 15% per annum from 03.09.2014 to 15.03.2019. The Financial Creditor and Corporate Debtor had entered into a Memorandum of Understanding (MOU) dated 03.09.2014, where the Corporate Debtor was to identify lands for development. The Corporate Debtor failed to identify the lands, leading to the termination of the MOU.

## Facts

M/s. VSL Securities Private Limited (Financial Creditor) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against M/s. Unishire Housing LLP (Corporate Debtor). The Financial Creditor's claim is based on a default of Rs.21,58,04,027.39/-, comprising a principal amount of Rs.12,94,00,000/- and interest of Rs.8,64,04,027.39/- calculated at 15% per annum from 03.09.2014 to 15.03.2019. The Financial Creditor and Corporate Debtor entered into a Memorandum of Understanding (MOU) dated 03.09.2014, where the Corporate Debtor was to identify lands for proposed development, arrange for inspection, finalize terms, and obtain legal clearances. The Corporate Debtor was also required to pay

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## Issues and analysis

### Issue 1: Whether the application filed by the Financial Creditor under Section 7 of the Insolvency and …

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

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**Reasoning:** The Adjudicating Authority considered the application filed by the Financial Creditor,

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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 Financial Creditor, M/s. VSL Securities Private Limited, filed the

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## Parties

- **Judges:** Rajeswara Rao…; Ashok Kumar…
- **Appellants:** M/s. VSL Securitie…
- **Respondents:** M/s Unishire…
- **Advocates:** Manasa…; G.S. Venkat…; +1 more

## Timeline

- **2014-09-03 — MOU Exec…**: Financial Creditor and Corporate Debtor entered…
- **2014-09-03 — Interest Calculation…**: Interest calculation at…

## 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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