# In the matter of Deepraj Vinimay Private Limited C.P. (IB) No. 922-KB-2020

> NCLT judgment dated 2022-05-10. Citation: TCN-2022-NCLT-02788. The case pertains to an application filed under Section 7(1) of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 10 May 2022
- **Citation:** TCN-2022-NCLT-02788
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/deepraj-vinimay-private-limited-cp-ib-no-922-kb-2020-592d852b

## Summary

### Background

The case pertains to an application filed under Section 7(1) of the Insolvency and Bankruptcy Code, 2016, read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, by M/s Manavta Trade-Link Private Limited (Financial Creditor) against M/s Deepraj Vinimay Private Limited (Corporate Debtor) for initiation of Corporate Insolvency Resolution Process (CIRP). The Financial Creditor claimed that the Corporate Debtor had approached them for financial assistance due to financial problems in running its business. The Financial Creditor disbursed loans to the Corporate Debtor in multiple tranches between September 2015 and July 2016. The Corporate Debtor allegedly defaulted on repayment, leading to the application for CIRP.

## Facts

M/s Manavta Trade-Link Private Limited (Financial Creditor) filed an application under Section 7(1) of the Insolvency and Bankruptcy Code, 2016 against M/s Deepraj Vinimay Private Limited (Corporate Debtor). The Corporate Debtor approached the Financial Creditor in September 2015 for a loan of Rs. 5,51,00,000/- due to financial difficulties. The Financial Creditor disbursed the loan in multiple tranches: Rs. 98,00,000/- on September 19, 2015; Rs. 1,15,00,000/- on September 24, 2015; Rs. 1,30,00,000/- on July 19, 2016; and Rs. 1,10,00,000/- on July 21, 2016. The Corporate Debtor issued demand promissory notes. The total amount claimed to be in default was Rs. 4,38,37,000/- along with interest at 12% P.A. The debt fell due on March 1, 2019. The Financial Creditor issued

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## Issues and analysis

### Issue 1: Whether the application filed by the Financial Creditor under Section 7 of the Insolvency and …

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

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**Reasoning:** The court considered the evidence presented by the Financial Creditor, including loan

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**Interpretation:** Section 7 provides the legal basis for a financial creditor to trigger the

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**Application:** The court applied Section 7 and Rule 4 to the facts of the case. The Financial

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## Parties

- **Judges:** RohitKa…; Harish Chander…
- **Appellants:** M/s Manavta…
- **Respondents:** M/s Deepraj…

## Timeline

- **2015-09-20 — Corporate Debtor…**: The Corporate Debtor approached the Financial Creditor for a loan of Rs. 5,51,00,000/-…
- **2015-09-19 — First Tranche…**: The Financial Creditor disbursed Rs.…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7(1) — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

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