# In the matter of GTL Infrastructure Limited IA-677-2020 & C.P.(IB)-4541(MB)-2019

> NCLT judgment dated 2022-11-18. Citation: TCN-2022-NCLT-00396. Canara Bank filed a Company Petition (IB)-4541(MB)/2019 under Section 7 of the Insolvency and…

- **Court:** NCLT
- **Order date:** 18 Nov 2022
- **Citation:** TCN-2022-NCLT-00396
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/gtl-infrastructure-limited-ia-677-2020-cpib-4541mb-2019-b1e73ab3

## Summary

### Background

Canara Bank filed a Company Petition (IB)-4541(MB)/2019 under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against GTL Infrastructure Limited due to a default of INR 646,38,06,271.00 as of 01.07.2011. GTL Infrastructure Limited had loans sanctioned and disbursed to it and Chennai Network Infrastructure Limited, which later merged into GTL Infrastructure Limited. The Corporate Debtor had undergone Corporate Debt Restructuring (CDR) in 2011 and Strategic Debt Restructuring (SDR). The lenders failed to find a new investor to transfer their shareholdings. Union Bank of India circulated a note regarding the sale of the debt to EARC Consortium. The account of the Corporate Debtor was classified as

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## Facts

Canara Bank filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate CIRP against GTL Infrastructure Limited for defaulting on a debt of INR 646,38,06,271.00 as of 01.07.2011. The debt originated from loans sanctioned to GTL Infrastructure Limited and Chennai Network Infrastructure Limited, which later merged into GTL Infrastructure Limited. GTL Infrastructure Limited underwent CDR in 2011 and SDR. The lenders were unable to find a new investor. Union Bank of India circulated a note regarding the sale of the debt to EARC Consortium. The account was classified as NPA w.e.f. July 1, 2011. The Respondent filed IA/677/2020 to dismiss the petition due to lack of authorization. GTL Infrastructure Limited submitted resolution plans, which were

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## Issues and analysis

### Issue 1: Whether the application under Section 7 of the IBC should be admitted given the Corporate Debtor's …

**Ratio:** The Adjudicating Authority has the discretion to admit or reject an application under

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**Reasoning:** The court considered the Corporate Debtor's monthly revenues, the amount repaid between

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**Interpretation:** Section 7(5)(a) of the IBC confers discretionary power on the Adjudicating

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**Application:** The court applied the ratio of Vidarbha Industries to the present case, finding

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## Parties

- **Judges:** P.N. Des…; Shyam Babu…
- **Appellants:** Canara…
- **Respondents:** GTL Infrastructure…

## Timeline

- **2011-07-01 — Default…**: The Corporate Debtor defaulted on…
- **2011-01-01 — Corporate Debt…**: The Corporate Debtor underwent…

## 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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