# In the matter of Visa Power Limited CP (IB) No. 574-KB-2017

> NCLT judgment dated 2017-12-22. Citation: TCN-2017-NCLT-00014. The Bank of Maharashtra, acting as a financial creditor, filed an application under Section 7…

- **Court:** NCLT
- **Order date:** 22 Dec 2017
- **Citation:** TCN-2017-NCLT-00014
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/visa-power-limited-cp-ib-no-574-kb-2017-e052670c

## Summary

### Background

The Bank of Maharashtra, acting as a financial creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate the Corporate Insolvency Resolution Process (CIRP) against Visa Power Limited, the corporate debtor. The application was based on the corporate debtor's failure to repay a debt of Rs. 94.08 crores as of August 31, 2017, which included unpaid interest of Rs. 17.37 crores and a principal amount of Rs. 76.71 crores. The corporate debtor argued that the petition was premature and filed with mala fide intent, as the majority of secured financial creditors were working on restructuring the debt. The financial creditor, however, contended that no restructuring proposal had been submitted and that the corporate debtor

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## Facts

Bank of Maharashtra, a banking company, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Visa Power Limited, a company incorporated under the Companies Act. The application was filed due to the corporate debtor's failure to repay a debt of Rs. 94.08 crores as of August 31, 2017, including unpaid interest of Rs. 17.37 crores and a principal amount of Rs. 76.71 crores. The Bank of Maharashtra was one of the co-lenders in the consortium finance, with a share of 5.1% of the total debt requirement of Rs. 1964 crores to Visa Power Limited for setting up a 2X 270 MW Coal field independent power plant at Raigarh, Chattisgarh. The corporate debtor argued that the petition was

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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:** The Adjudicating Authority is bound to admit the application if it is proved that the

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**Reasoning:** The NCLT relied on the Supreme Court's judgment in Innovative Industries Ltd. v. ICICI

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**Interpretation:** This interpretation clarifies that the Adjudicating Authority's primary

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**Application:** In this case, the NCLT found that the financial creditor had provided

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## Parties

- **Judges:** V. P. S…; Jinan…
- **Appellants:** Bank of Maharashtr…
- **Respondents:** Visa Power…
- **Advocates:** Mr.SMS…; Arun G…; +2 more

## Timeline

- **2010-03-05 — Facility Ag…**: Facility agreement executed between the Corporate debtor (borrower) and the banks and…
- **2014-09-15 — Reminder L…**: Financial Creditor sent various reminder…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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