# In the matter of Devas Engineering Systems Pvt. Ltd. CP (IB)-52(CHE) 2022

> NCLT judgment dated 2022-09-09. Citation: TCN-2022-NCLT-01117. The case involves an application filed by Union Bank of India, Hosur Branch, under Section 7 of…

- **Court:** NCLT
- **Order date:** 9 Sept 2022
- **Citation:** TCN-2022-NCLT-01117
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/devas-engineering-systems-pvt-ltd-cp-ib-52che-2022-06c52abd

## Summary

### Background

The case involves an application filed by Union Bank of India, Hosur Branch, under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against Devas Engineering Systems Pvt. Ltd. The financial creditor claims a debt of Rs. 29,39,87,476.00 as of 04.12.2015, with further interest and other charges. The corporate debtor's account was classified as NPA on 04.12.2015. The financial creditor restructured and modified the facilities at the request of the corporate debtor. The application seeks to declare a moratorium and appoint an Interim Resolution Professional (IRP).

## Facts

Union Bank of India, Hosur Branch, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate CIRP against Devas Engineering Systems Pvt. Ltd. The financial creditor claimed a debt of Rs. 29,39,87,476.00 as of 04.12.2015, with further interest and other charges. The corporate debtor's account was classified as NPA on 04.12.2015. The financial creditor restructured and modified the facilities at the request of the corporate debtor. The application seeks to declare a moratorium and appoint an Interim Resolution Professional (IRP). The Corporate Debtor acknowledged the debt in its balance sheets for the financial years 2015, 2016, 2017, 2018, 2019 & 2021. SARFAESI proceedings initiated by the Financial Creditor against the Corporate

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## Issues and analysis

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

**Ratio:** The ratio is that an application under Section 7 of the IBC is maintainable if there is a

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**Reasoning:** The Adjudicating Authority considered the submissions of the Financial Creditor and the

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

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**Application:** In this case, the Financial Creditor provided evidence of debt and default, and

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## Parties

- **Judges:** BACHU VENKAT…; SAMEER…
- **Respondents:** Devas Engineering…; Mr.R.SUGU…
- **Advocates:** Shanthi Mee…; R.Sugum…; +1 more

## Timeline

- **2015-12-04 — Account Classified as…**: The account of Devas Engineering Systems Pvt. Ltd. was classified as Non-Performing Asset…
- **2015-12-04 — Date of D…**: The date of default is averred in…

## 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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