# In the matter of ECI Engineering and Construction Company Ltd.

> NCLT judgment dated 2023-08-07. Citation: TCN-2023-NCLT-02150. The case involves a Company Petition filed under Section 7 of the IBC, 2016. The Financial…

- **Court:** NCLT
- **Order date:** 7 Aug 2023
- **Citation:** TCN-2023-NCLT-02150
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/eci-engineering-and-construction-company-ltd-77bb16f4

## Summary

### Background

The case involves a Company Petition filed under Section 7 of the IBC, 2016. The Financial Creditor and Corporate Debtor submitted a joint memo reporting a settlement pursuant to an OTS (One Time Settlement) dated 14.07.2023.

## Facts

ASREC (India) Limited, the Financial Creditor, initiated a Company Petition against ECI Engineering and Construction Company Ltd, the Corporate Debtor, under Section 7 of the IBC, 2016. Subsequently, both parties entered into a settlement agreement, formalized through an OTS dated 14.07.2023. A joint memo, signed by both the Financial Creditor and the Corporate Debtor on 05.08.2023, was submitted to the court, reporting the settlement. The joint memo indicated that the parties had reached a compromise, rendering further adjudication of the Company Petition unnecessary. The court, after reviewing the joint memo, disposed of the Company Petition, while granting the Financial Creditor the liberty to approach the Tribunal in case of default by the Corporate Debtor in

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## Issues and analysis

### Issue 1: Whether the Company Petition should be disposed of in light of the settlement reached between the …

**Ratio:** When parties to a legal proceeding reach a settlement, the court may dispose of the

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**Reasoning:** The court reasoned that the joint memo submitted by the Financial Creditor and the

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**Interpretation:** This reflects the principle that courts generally favor settlements and

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**Application:** In this case, the existence of the joint memo reporting a settlement pursuant

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## Parties

- **Judges:** Venkata Ramakrishn…; SH. CHARAN…
- **Appellants:** Asrec (India)…
- **Respondents:** ECI Engineering…

## Timeline

- **2023-07-14 — OTS Date…**: One Time Settlement…
- **2023-08-05 — Joint Mem…**: Joint memo signed by the Financial Creditor and Corporate Debtor dated 05.08.2023…

## 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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