# In the matter of PG Advertising Private Limited Formerly Known as Prabhatam Advertising Private Limited (IB)-996(ND)-2020

> NCLT judgment dated 2022-10-18. Citation: TCN-2022-NCLT-00692. Tulsi Nandan Kant Bansal, the Applicant/Financial Creditor, filed an application under Section…

- **Court:** NCLT
- **Order date:** 18 Oct 2022
- **Citation:** TCN-2022-NCLT-00692
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/pg-advertising-private-limited-formerly-known-as-prabhatam-advertising-private-l-63c6203d

## Summary

### Background

Tulsi Nandan Kant Bansal, the Applicant/Financial Creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, to initiate the Corporate Insolvency process against M/s. P.G. Advertising Private Limited, formerly known as Prabhatam Advertising Private Limited, the Respondent. The Respondent is a company incorporated on 2005-04-08 under the Companies Act, 1956. The applicant stated that a loan agreement was executed between the parties on 2018-08-28, pursuant to which the applicant advanced a loan of Rs. 1,05,00,000 to the respondent, which was to be repaid by 2019-10-31. The loan was disbursed on 2018-08-28 in two tranches of Rs. 85 lakhs

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## Facts

Tulsi Nandan Kant Bansal (Applicant/Financial Creditor) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency process against M/s. P.G. Advertising Private Limited (Respondent). A loan agreement was executed between the parties on 2018-08-28, where the Applicant advanced a loan of Rs. 1,05,00,000 to the Respondent. The loan was to be repaid by 2019-10-31, and it was disbursed in two tranches on 2018-08-28. The Applicant claimed that the Respondent failed to repay the loan despite reminders. The Respondent admitted the debt during the hearing. The applicant has claimed Rs.1,05,00,000/- as an unpaid financial debt.

## Issues and analysis

### Issue 1: Whether the application under Section 7 of the Insolvency and Bankruptcy Code, 2016 should be …

**Ratio:** Section 7(5) of the IBC allows the Adjudicating Authority to admit an application if it

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**Reasoning:** The court considered the loan agreement, bank statements, and the Respondent's admission

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**Interpretation:** Section 7 of the IBC provides the mechanism for initiating CIRP by a financial

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**Application:** The court applied Section 7(5) of the IBC to the facts of the case and found

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## Parties

- **Judges:** BACHU VENKAT…; L. N. G…
- **Appellants:** Tulsi Nandan Kant…
- **Respondents:** M/s. P.G.…
- **Advocates:** Sanjeev K…; Sunil Cho…

## Timeline

- **2005-04-08 — Company Incor…**: M/s. P.G. Advertising Private Limited was…
- **2018-08-28 — Loan Agre…**: Loan agreement executed between Tulsi Nandan Kant Bansal and M/s. P.G. Advertising…

## 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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