# In the matter of Vimal Oil & Foods Ltd. C.P. (I.B) No. 135-7-NCLT-AHM-2017

> NCLT judgment dated 2017-12-19. Citation: TCN-2017-NCLT-00028. Bank of Baroda filed an application under Section 7 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 19 Dec 2017
- **Citation:** TCN-2017-NCLT-00028
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/vimal-oil-foods-ltd-cp-ib-no-135-7-nclt-ahm-2017-ce5250e1

## Summary

### Background

Bank of Baroda filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Vimal Oil and Foods Limited, seeking to initiate the Corporate Insolvency Resolution Process (CIRP). The application was filed due to the corporate debtor's failure to repay the financial debt owed to the bank. The bank had sanctioned various credit facilities to the corporate debtor, which were subsequently renewed and enhanced over time through supplemental agreements. Despite these renewals, the corporate debtor defaulted on its repayment obligations, leading to the bank classifying the account as a Non-Performing Asset (NPA) and initiating the CIRP.

## Facts

Bank of Baroda (BOB) filed an application under Section 7 of the Insolvency and Bankruptcy Code (IBC) against Vimal Oil and Foods Limited, seeking to initiate Corporate Insolvency Resolution Process (CIRP). BOB had extended various credit facilities to Vimal Oil and Foods Limited, including cash credit facilities and letter of credit facilities, under a Working Capital Consortium Agreement dated October 14, 2006. These facilities were subsequently renewed and enhanced through several supplemental agreements. The total debt granted to the Corporate Debtor under the Seventh Supplemental Working Capital Consortium Agreement is Rs. 173,00,00,000. The account was classified as NPA on November 9, 2015. The bank issued notices to the Corporate Debtor to pay the outstanding

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## Issues and analysis

### Issue 1: Whether the application filed by the …

**Ratio:** A power of attorney holder can file a petition if they are duly authorized by the company

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**Reasoning:** The court noted that apart from the General Power of Attorney dated 15th December, 2009,

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**Interpretation:** This clarifies that a power of attorney holder can initiate proceedings if they

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**Application:** The court found that the power of attorney holder was authorized to file the

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## Parties

- **Judges:** BIKKI RAVEENDRA…; Manorama…
- **Appellants:** Bank of B…
- **Respondents:** Vimal Oil and…

## Timeline

- **2006-10-14 — Working Capital…**: BOB sanctioned facilities to the Corporate Debtor under the Working Capital Consortium…
- **2008-02-02 — First Supplemental…**: Execution of First Supplemental Working Capital Consortium Agreement; facilities renewed…

## 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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