# In the matter of Varia Engineering Work Pvt Ltd. C.P. (I.B) No. 149-7-NCLT-AHM-2017

> NCLT judgment dated 2017-12-21. Citation: TCN-2017-NCLT-00018. Bank of Baroda filed an application under Section 7 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 21 Dec 2017
- **Citation:** TCN-2017-NCLT-00018
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/varia-engineering-work-pvt-ltd-cp-ib-no-149-7-nclt-ahm-2017-528de962

## Summary

### Background

Bank of Baroda filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against M/s. Varia Engineering Works Private Limited. Bank of Baroda had sanctioned various credit facilities to Varia Engineering Works, which were restructured under a Master Restructuring Agreement (MRA) dated March 31, 2015. The Corporate Debtor defaulted on these facilities, leading to the application for CIRP.

## Facts

Bank of Baroda, the financial creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Varia Engineering Works Private Limited, the corporate debtor. The bank had sanctioned various credit facilities to the corporate debtor, which were restructured under a Master Restructuring Agreement (MRA) dated March 31, 2015. These facilities included rupee term loans, working capital term loans, and a funded interest term loan. The corporate debtor defaulted on these facilities. The total amount in default as of June 30, 2017, was Rs. 86,57,27,647.15. The first date of default varied for different facilities, generally occurring in March 2016 or February 2016. The financial

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## Issues and analysis

### Issue 1: Whether the application under Section 7 of the Insolvency and Bankruptcy Code, 2016 is complete and …

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

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**Reasoning:** The Adjudicating Authority perused the petition and found it to be complete in all

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**Interpretation:** The completeness of the application is a prerequisite for its maintainability.

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**Application:** In this case, the Adjudicating Authority found the application to be complete

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## Parties

- **Judges:** BIKKI RAVEENDRA…
- **Appellants:** Bank of B…
- **Respondents:** Varia Engineering…; Varia Engineering…

## Timeline

- **2015-03-31 — Master Restructuring…**: Bank of Baroda and Varia Engineering Works Private Limited entered into a Master…
- **2016-02-29 — First Date of…**: The first date of default for the fund…

## 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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