# In the matter of Envirant Developers Private Limited C.P.(IB) No. 283 of 2023

> NCLT judgment dated 2023-05-19. Citation: TCN-2023-NCLT-03256. Vistara ITCL (India) Limited, the Financial Creditor, filed a Company Petition under Section 7…

- **Court:** NCLT
- **Order date:** 19 May 2023
- **Citation:** TCN-2023-NCLT-03256
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/envirant-developers-private-limited-cpib-no-283-of-2023-a9976ddc

## Summary

### Background

Vistara ITCL (India) Limited, the Financial Creditor, filed a Company Petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Envirant Developers Private Limited, the Corporate Debtor, due to alleged default in payment of financial debt. The petition was filed invoking Section 7 of the Insolvency and Bankruptcy Code read with Rule 4 of the Insolvency & Bankruptcy (Application to Adjudicating Authority) Rules, 2016, for a resolution of financial debt amounting to Rs. 65,08,05,433/-. Envirant Developers Private Limited had proposed to develop two projects and authorized the issuance of fully secured, unlisted, redeemable, non-convertible Series A debentures. India Realty

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## Facts

Envirant Developers Private Limited (EDPL) proposed to develop two projects, Project-Panorama and Project-Vedanta, and authorized the issuance of 5,790 fully secured, unlisted, redeemable, non-convertible Series A debentures. India Realty Excellence Fund III (IREF III) and India Realty Excellence Fund IV (IREF IV) agreed to invest by subscribing to 3,441 EDPL Series A NCDs. A Debenture Trust Deed (EDPL DTD) was executed on 2018-11-26, appointing Vistara ITCL (India) Limited as the Debenture Trustee. The Debenture Holders invested a total of Rs. 34,41,00,000/-. The Corporate Debtor started committing payment defaults, and the Debenture Holders and the Fund Manager addressed several notices to the Corporate Debtor. The debentures were to be redeemed in 8 quarterly

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## Issues and analysis

### Issue 1: Whether the Financial Creditor has established the existence of a financial debt and default by the …

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

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**Reasoning:** The court considered the Debenture Trust Deed, disbursement details, and default notices

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**Interpretation:** The court interpreted Section 7 of the IBC to mean that if a financial debt

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**Application:** The court applied the ratio to the facts by determining that the documents

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## Parties

- **Judges:** Kuldip Kumar…; Madhu S…
- **Appellants:** Vistara ITCL…
- **Respondents:** Envirant Developer…

## Timeline

- **2018-11-26 — Execution of Debenture…**: A Debenture Trust Deed (EDPL DTD) was executed, wherein Vistara ITCL (India) Limited was…
- **2019-02-13 — Investment by…**: India Realty Excellence Fund III (IREF…

## 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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