# In the matter of Virgo Properties Private Limited IA(IBC)-350(CHE)-2022 in CP-IB-28(CHE)-2022

> NCLT judgment dated 2023-06-16. Citation: TCN-2023-NCLT-05444. The application was filed under Section 8 of the Arbitration and Conciliation Act, 1996, read…

- **Court:** NCLT
- **Order date:** 16 Jun 2023
- **Citation:** TCN-2023-NCLT-05444
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chennai/virgo-properties-private-limited-iaibc-350che-2022-in-cp-ib-28che-2022-a2cb271e

## Summary

### Background

The application was filed under Section 8 of the Arbitration and Conciliation Act, 1996, read with Rule 11 of the NCLT Rules, 2016, seeking to refer the matter to an Arbitral Tribunal. The applicant, M/s. Virgo Properties Private Limited, is the financial creditor, and the respondent, M/s. L&T Finance Limited, is the corporate debtor.

## Facts

M/s. Virgo Properties Private Limited, the applicant and financial creditor, filed an application to refer a dispute to an Arbitral Tribunal. This application was made under Section 8 of the Arbitration and Conciliation Act, 1996, read with Rule 11 of the NCLT Rules, 2016. The dispute arose from a Loan Agreement dated June 23, 2017, between the applicant and M/s. L&T Finance Limited, the respondent and corporate debtor. The applicant invoked the arbitration clause (Clause 17.10) in the Loan Agreement by sending a Notice of Arbitration on November 12, 2021. Due to a disagreement over the arbitrator's appointment, the applicant approached the High Court under Section 11 of the Arbitration and Conciliation Act, 1996. Concurrently, the respondent also sought

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## Issues and analysis

### Issue 1: Whether an application under Section 8 of the Arbitration and Conciliation Act, 1996, is …

**Ratio:** An application under Section 8 of the Arbitration and Conciliation Act, 1996, is not

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**Reasoning:** The NCLT reasoned that the existence of an arbitration clause or ongoing arbitration

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**Interpretation:** The court interpreted that the Adjudicating Authority's role under Section 7 of

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**Application:** In this case, despite the ongoing arbitration proceedings and the application

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## Parties

- **Judges:** SANJIV…; SAMEER…
- **Appellants:** Virgo Properties…; M/s. Virgo…
- **Respondents:** L&T Finance…; M/s L&T Finance…
- **Advocates:** P.C. Hari…; Sriram Venkatavara…; +9 more

## Timeline

- **June 23, 2017 — Loan Agre…**: Loan Agreement entered into between the…
- **November 12, 2021 — Notice of Arb…**: Applicant invoked Clause 17.10 (Arbitration Clause) in the Loan Agreement by sending a…

## 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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