# In the matter of Great Indian Nautanki Company Private Limited CP (IB) - 24 (PB)-2022

> NCLT judgment dated 2022-10-21. Citation: TCN-2022-NCLT-00639. Bank of Baroda filed an application under Section 7 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 21 Oct 2022
- **Citation:** TCN-2022-NCLT-00639
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/great-indian-nautanki-company-private-limited-cp-ib-24-pb-2022-8b7d62f7

## Summary

### Background

Bank of Baroda filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against Great Indian Nautanki Company Private Limited due to a default in repayment of Rs. 126,26,79,319.14. The Corporate Debtor was incorporated on 18/09/2007 and had been sanctioned 4 term loans totaling Rs 54,50,00000/-. The account was restructured on 29.09.2012, but the Corporate Debtor became irregular in servicing its obligations, leading to the account slipping into NPA in Sept 2014.

## Facts

Bank of Baroda sanctioned four term loans to Great Indian Nautanki Company Private Limited, totaling Rs 54,50,00000/-. The loans were disbursed between 2009 and 2010. The Corporate Debtor executed a Demand Promissory note, Letter of installment with acceleration clause, Instrument of Hypothecation of movable machinery, and Corporate guarantee. The account was restructured on 29.09.2012, but the Corporate Debtor defaulted on its obligations, and the account was classified as NPA in September 2014. As of 30.11.2021, the total amount outstanding was Rs. 126,26,79,319.14. The Corporate Debtor acknowledged the debt in its balance sheets for FY ending 31.03.2017, 31.03.2018, 31.03.2019 and 31.03.2020. The Corporate Debtor made payments from 10.12.2018 to 03.03.2020, with the

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## Issues and analysis

### Issue 1: Whether the application filed by Bank of Baroda under Section 7 of the Insolvency and Bankruptcy …

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

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**Reasoning:** The Adjudicating Authority found that the Corporate Debtor had defaulted in repaying the

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**Interpretation:** Section 7 of the IBC provides the mechanism for a financial creditor to

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**Application:** The Financial Creditor demonstrated that the Corporate Debtor had defaulted on

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## Parties

- **Judges:** Ramalingam…; AVINASH K.…
- **Appellants:** Bank of B…
- **Respondents:** Great Indian…

## Timeline

- **2007-09-18 — Incorporation of…**: Great Indian Nautanki Company…
- **2009-09-24 — First Loan Dis…**: Rs 15.00 Crores…

## 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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