# In the matter of Appollo Distilleries and Breweries Pvt. Ltd. C.P. (IB) No. 217-BB-2020

> NCLT judgment dated 2022-02-23. Citation: TCN-2022-NCLT-03995. Punjab National Bank filed an application under Section 7 of the Insolvency and Bankruptcy Code…

- **Court:** NCLT
- **Order date:** 23 Feb 2022
- **Citation:** TCN-2022-NCLT-03995
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/appollo-distilleries-and-breweries-pvt-ltd-cp-ib-no-217-bb-2020-6cf4ef59

## Summary

### Background

Punjab National Bank filed an application under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against M/s. Apollo Distilleries And Breweries Pvt. Ltd., citing a default on loan repayments. The bank had sanctioned term loan and cash credit facilities to the corporate debtor, secured by equitable mortgage of immovable properties and personal guarantees from the directors. Despite restructuring and renewals, the corporate debtor failed to revamp its business operations, leading to the classification of the loan accounts as Non-Performing Assets (NPA). The bank issued a demand notice, but the corporate debtor failed to comply. The corporate debtor contested the application, arguing that no financial

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## Facts

Punjab National Bank (PNB) extended term loan and cash credit facilities to M/s. Apollo Distilleries And Breweries Pvt. Ltd. The loans were secured by an equitable mortgage on immovable property and personal guarantees from the directors. Despite restructuring and renewals, Apollo Distilleries failed to meet its repayment obligations, leading PNB to classify the accounts as Non-Performing Assets (NPA) on 30.09.2018. PNB issued a demand notice on 07.01.2020 for Rs. 60,52,08,666.03/- as on 31.07.2020. Apollo Distilleries failed to comply with the demand. PNB filed an application under Section 7 of the IBC, 2016, to initiate Corporate Insolvency Resolution Process (CIRP). Apollo Distilleries contested the application, claiming no financial debt was established and that

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## Issues and analysis

### Issue 1: Whether the present Petition has been filed under Section 7 of the IBC by the Financial Creditor, …

**Ratio:** Section 7 of the IBC allows a financial creditor to initiate CIRP against a corporate

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**Reasoning:** The Adjudicating Authority found that the application was complete and that the financial

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

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**Application:** In this case, the Adjudicating Authority found that the financial creditor had

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## Parties

- **Judges:** Ajay Kumar…; Manoj Kumar…
- **Appellants:** Punjab National…
- **Respondents:** M/s. Apollo…

## Timeline

- **2010-08-27 — Loan San…**: Punjab National Bank sanctioned a term loan…
- **2010-10-29 — Mortgage Cr…**: Apollo Distilleries executed a Memorandum of Deposit of Title Deeds, mortgaging property…

## 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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