# In the matter of Vyas Mercantile Private Limited C.P. 2675-MB-2019

> NCLT judgment dated 2021-03-16. Citation: TCN-2021-NCLT-02678. The case pertains to a petition filed under Section 7 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 16 Mar 2021
- **Citation:** TCN-2021-NCLT-02678
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/vyas-mercantile-private-limited-cp-2675-mb-2019-3a6e68da

## Summary

### Background

The case pertains to a petition filed under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking initiation of the Corporate Insolvency Resolution Process (CIRP) against Vyas Mercantile Private Limited, the corporate debtor, for defaulting on a loan repayment. Birendra Kumar Agrawal, the petitioner, had sanctioned a loan to the corporate debtor, and upon default, filed the petition before the NCLT.

## Facts

Birendra Kumar Agrawal sanctioned a loan of Rs. 30,00,000 to Vyas Mercantile Private Limited under a loan agreement dated 2018-02-01. On the same day, the respondent executed a promissory note for the same amount. The respondent defaulted on the loan repayment starting 2019-06-30. As of 2019-07-12, the outstanding amount was Rs. 26,13,521.80, including 10% per annum interest. The respondent acknowledged the debt of Rs. 25,94,445 on 2019-06-10 and promised repayment by 2019-06-25, but failed to do so. The petitioner sent a letter on 2019-06-05 demanding repayment. The court served notice to the corporate debtor, but the debtor did not appear or file a reply. This led the court to proceed ex parte.

## Issues and analysis

### Issue 1: Whether the petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, should be …

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

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**Reasoning:** The court perused the documents filed by the petitioner, including the loan agreement,

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**Interpretation:** Section 7 of the IBC is interpreted to provide a mechanism for financial

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**Application:** The petitioner provided sufficient evidence of the loan agreement, default, and

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## Parties

- **Judges:** Janab Mohammed…; V. Nallasen…
- **Appellants:** Birendra Kumar…
- **Respondents:** Vyas Mercantile…

## Timeline

- **2018-02-01 — Loan Agre…**: Petitioner sanctioned a loan of Rs. 30,00,000 to the Respondent, and the Respondent…
- **2019-06-02 — Respondent's Confirmatio…**: Respondent confirmed that an amount of Rs. 22,89,216/- was due and outstanding as on…

## 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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