# In the matter of Ashiana Landcraft Realty Pvt. Ltd. C.P (IB) No.666-KB-2020

> NCLT judgment dated 2022-01-11. Citation: TCN-2022-NCLT-04466. IDBI Trusteeship Services Limited, acting as the Financial Creditor, filed an application under…

- **Court:** NCLT
- **Order date:** 11 Jan 2022
- **Citation:** TCN-2022-NCLT-04466
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/ashiana-landcraft-realty-pvt-ltd-cp-ib-no666-kb-2020-992be351

## Summary

### Background

IDBI Trusteeship Services Limited, acting as the Financial Creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Ashiana Landcraft Realty, the Corporate Debtor, for initiation of the Corporate Insolvency Resolution Process (CIRP). The Financial Creditor claimed that the Corporate Debtor had defaulted on payments related to non-convertible debentures (NCDs) and optionally convertible debentures (OCDs). The Corporate Debtor contested the application, citing defects, alleged breaches of settlement terms, and malicious intent. The Corporate Debtor argued that the application was not maintainable and that there was no actual default.

## Facts

IDBI Trusteeship Services Limited filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Ashiana Landcraft Realty, claiming a default on non-convertible and optionally convertible debentures. Ashiana Landcraft Realty issued NCDs and OCDs, a portion of which was acquired by IIFL Income Opportunities Fund Series. IDBI Trusteeship Services was appointed as the Debenture Trustee. The Corporate Debtor sought extensions for redemption, which were initially granted. However, the Corporate Debtor defaulted on repayment by February 28, 2019, leading the Financial Creditor to issue notices in September and November 2019. The total default claimed was Rs. 139,99,00,000/- as of February 15, 2020. Ashiana Landcraft Realty acquired development

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## Issues and analysis

### Issue 1: Whether the application under Section 7 of the Insolvency and Bankruptcy Code, 2016, is …

**Ratio:** A Debenture Trustee may file an application for initiating the Corporate Insolvency

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**Reasoning:** The NCLT relied on the notification of the Ministry of Corporate Affairs, which

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**Interpretation:** The notification clarifies that a Debenture Trustee, acting on behalf of the

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**Application:** IDBI Trusteeship Services Limited, as the Debenture Trustee, was empowered to

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## Parties

- **Judges:** RohitKa…; Harish Chander…
- **Appellants:** IDBI Trusteeship…
- **Respondents:** Ashiana Landcraft…

## Timeline

- **2013-08-21 — Development A…**: Ashiana Landcraft Realty acquired…
- **2013-09-03 — Debenture Tru…**: Debenture Trustee Appointment…

## 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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