# In the matter of Goenka Diamond and Jewels Limited IA (IB) 580-JPR-2022 in CP No. (IB)- 114-7-JPR-2019

> NCLT judgment dated 2022-12-09. Citation: TCN-2022-NCLT-00195. The case involves an application filed by Union Bank of India (erstwhile Corporation Bank), the…

- **Court:** NCLT
- **Order date:** 9 Dec 2022
- **Citation:** TCN-2022-NCLT-00195
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/goenka-diamond-and-jewels-limited-ia-ib-580-jpr-2022-in-cp-no-ib-114-7-jpr-2019-6f5a723f

## Summary

### Background

The case involves an application filed by Union Bank of India (erstwhile Corporation Bank), the Financial Creditor, under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Goenka Diamond and Jewels Limited, the Corporate Debtor. The Corporate Debtor is a public limited company engaged in the diamond and jewelry business. The Corporate Debtor availed credit facilities from a consortium of eight banks, including the Financial Creditor. The loan accounts were declared Non-Performing Assets (NPA) by March 31, 2016. The Financial Creditor initiated SARFAESI proceedings and took possession of the Corporate Debtor's properties. The Corporate Debtor offered multiple One-Time Settlement (OTS) proposals,

…

## Facts

Union Bank of India (formerly Corporation Bank) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Goenka Diamond and Jewels Limited. Goenka Diamond and Jewels Limited, a public limited company, is engaged in the diamond and jewelry business. The Corporate Debtor availed credit facilities to the tune of approximately Rs. 216 Crores from a consortium of eight banks, including Union Bank of India. The loan accounts of the Corporate Debtor with the consortium of banks were declared Non-Performing Assets (NPA) by 31st March 2016, with an outstanding amount of Rs. 152 Crores. The Financial Creditor initiated SARFAESI proceedings and took possession of the movable and immovable

…

## 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

…

**Reasoning:** The Adjudicating Authority found that the Corporate Debtor had availed loan/credit

…

**Interpretation:** Section 7 provides a mechanism for financial creditors to recover their dues

…

**Application:** The Adjudicating Authority applied Section 7 to the facts of the case and found

…

## Parties

- **Judges:** Deep Chandr…; Prasanta Kumar…
- **Appellants:** Union Bank of…
- **Respondents:** Goenka Diamond…

## Timeline

- **2011-12-19 — Sanction…**: Financial Creditor sanctioned financial…
- **2015-12-15 — Default…**: The Corporate Debtor defaulted…

## 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)

---

This is a preview. The full structured summary, issues, precedents and source judgment are available on CaseEase - Legal Intelligence Simplified: https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/goenka-diamond-and-jewels-limited-ia-ib-580-jpr-2022-in-cp-no-ib-114-7-jpr-2019-6f5a723f