# In the matter of Yamuna Infradevelopers Pvt. Ltd. (IB)-479(ND)-2019

> NCLT judgment dated 2019-05-01. Citation: TCN-2019-NCLT-03594. Oriental Bank of Commerce, as a Financial Creditor, initiated the Corporate Insolvency…

- **Court:** NCLT
- **Order date:** 1 May 2019
- **Citation:** TCN-2019-NCLT-03594
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/yamuna-infradevelopers-pvt-ltd-ib-479nd-2019-19e37036

## Summary

### Background

Oriental Bank of Commerce, as a Financial Creditor, initiated the Corporate Insolvency Resolution Process (CIRP) against Yamuna Infradevelopers Pvt. Ltd. due to the company's inability to liquidate its debts. Yamuna Infradevelopers, engaged in Real Estate & Construction, had been sanctioned a term loan of Rs. 10 crores to participate in an auction for Mineral Blocks/Units in Haryana. They executed loan documents to repay the principal in 66 monthly installments commencing in 2016. The Corporate Debtor secured the loan with an equitable mortgage of commercial land and building. They failed to maintain financial discipline, leading to the account being declared an NPA. A notice under the SARFAESI Act was issued.

## Facts

Oriental Bank of Commerce (Financial Creditor) sought to initiate Corporate Insolvency Resolution Process (CIRP) against Yamuna Infradevelopers Pvt. Ltd. (Corporate Debtor) due to its inability to liquidate debts. The Corporate Debtor, involved in Real Estate & Construction, received a term loan of Rs. 10 crores for participating in mineral block auctions in Haryana. The loan was to be repaid in 66 monthly installments from 2016. The loan was secured by an equitable mortgage on commercial land and building. The Corporate Debtor failed to maintain financial discipline and defaulted on repayments, leading to the account being declared a Non-Performing Asset (NPA). A notice was issued under the SARFAESI Act. The outstanding dues amounted to Rs. 2,23,10,216/-. The

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## Issues and analysis

### Issue 1: Whether the petition filed by the Financial Creditor for initiating CIRP against the Corporate …

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

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**Reasoning:** The Corporate Debtor defaulted on its repayment obligations, leading to its account being

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**Interpretation:** Section 7 of the IBC provides a mechanism for financial creditors to recover

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**Application:** The Corporate Debtor's failure to repay the loan, despite acknowledging the

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## Parties

- **Judges:** Ina Mal…; V.K. SUB…
- **Appellants:** Oriental Bank of…
- **Respondents:** Yamuna Infradevelo…

## Timeline

- **2016-01-01 — Loan Sanc…**: A term loan of Rs. 10 crores was…
- **2018-02-16 — Debt Balance Confirmatio…**: Yamuna Infradevelopers Pvt. Ltd.…

## 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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