# In the matter of Archon Powerinfra India Private Limited IA No. 677 of 2021 in CP (IB) No. 611-7-NCLT-AHM-2019

> NCLT judgment dated 2022-04-27. Citation: TCN-2022-NCLT-03012. The case involves an application filed under Section 7 of the Insolvency and Bankruptcy Code…

- **Court:** NCLT
- **Order date:** 27 Apr 2022
- **Citation:** TCN-2022-NCLT-03012
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/archon-powerinfra-india-private-limited-ia-no-677-of-2021-in-cp-ib-no-611-7-nclt-61f52eb2

## Summary

### Background

The case involves an application filed under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016, by Enoch Infrabuild LLP to initiate Corporate Insolvency Resolution Process (CIRP) against Archon Powerinfra India Private Limited, alleging a default in payment of Rs. 1,85,00,000/-. The Corporate Debtor filed IA No. 677 of 2021, bringing documents in defense, claiming the amount is disputed due to a pending commercial suit and arbitration proceeding. The applicant claims to be a financial creditor based on a sub-contract agreement dated 24.08.2017 and a subsequent settlement recorded in minutes of meeting dated 16.03.2018, where the Corporate Debtor agreed to pay Rs. 1.85 Crore.

## Facts

Enoch Infrabuild LLP filed an application under Section 7 of the IBC to initiate CIRP against Archon Powerinfra India Private Limited, claiming a default of Rs. 1,85,00,000/-. Archon Powerinfra India Private Limited (formerly known as SKP Buildcon Pvt. Ltd.) was contracted by Indian Oil Corporation of India Ltd (IOCL) for construction work at an LPG Bottling Plant in Budge Budge, West Bengal. Archon Powerinfra India Private Limited sub-contracted part of the work to Enoch Infrabuild LLP. A sub-contract agreement was executed between Archon Powerinfra India Private Limited and Enoch Infrabuild LLP on 24.08.2017. Minutes of a meeting dated 16.03.2018 indicated that Archon Powerinfra India Private Limited agreed to pay Rs. 1.85 Crore to Enoch Infrabuild LLP. Archon

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## Issues and analysis

### Issue 1: Whether the amount payable by the Corporate Debtor to the Applicant arising out of a sub-contract …

**Ratio:** The definition of 'financial debt' under Section 5(8) of the IBC requires a debt along

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**Reasoning:** The court reasoned that the transaction between the parties was a sub-contract, and the

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**Interpretation:** The court interpreted Section 5(8) of the IBC to mean that a financial debt

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**Application:** The court applied the ratio to the facts of the case, finding that the amount

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## Parties

- **Judges:** Madan B.…; KAUSHALENDRA…
- **Appellants:** Archon Powerinfra…
- **Respondents:** Archon Powerinfra…; Enoch Infrabuild…
- **Advocates:** Arjun S…; Ketan M.…

## Timeline

- **2016-01-01 — Enactment…**: The Insolvency and…
- **2017-08-24 — Sub-contract A…**: A sub-contract agreement was executed between Archon Powerinfra India Private Limited and…

## 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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