# In the matter of Precision Realty Developers Private Limited

> NCLT judgment dated 2023-10-20. Citation: TCN-2023-NCLT-01082. Phoenix ARC Private Limited filed a petition under Section 7 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 20 Oct 2023
- **Citation:** TCN-2023-NCLT-01082
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/precision-realty-developers-private-limited-d76b3364

## Summary

### Background

Phoenix ARC Private Limited filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Precision Realty Developers Private Limited, alleging default in payment of Rs. 1,18,95,06,176/-. The financial creditor, Phoenix ARC Private Limited, claimed that the corporate debtor, Precision Realty Developers Private Limited, defaulted on a loan facility originally sanctioned to Kaa Vee Retail Infra Private Limited, which later merged with the corporate debtor. The original loan was sanctioned by L & T Finance Limited, and subsequently assigned to Phoenix ARC Private Limited.

## Facts

Phoenix ARC Private Limited, the financial creditor, filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate CIRP against Precision Realty Developers Private Limited, the corporate debtor. The claim was based on a default of Rs. 1,18,95,06,176/-. The original loan facility of INR 200 Crores was sanctioned to Kaa Vee Retail Infra Private Limited by L & T Finance Limited, the original lender, on 13th February, 2017. This loan was secured through various means, including pledging of shares, personal guarantees from promoters, and a deed of hypothecation. Kaa Vee Retail Infra Private Limited subsequently merged with Precision Realty Developers Private Limited via an order dated 8th May, 2019, passed by the NCLT, Mumbai, with the

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## Issues and analysis

### Issue 1: Whether the Petitioner has been able to establish the factum of existence of financial debt and its …

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

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**Reasoning:** The NCLT found that the financial creditor had presented sufficient evidence, including

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**Interpretation:** Section 7 requires the financial creditor to prove the existence of a financial

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**Application:** The NCLT applied the provisions of Section 7 to the facts of the case, finding

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## Parties

- **Judges:** Kuldip Kumar…; ANURADHA SANJAY…
- **Appellants:** Phoenix Arc…
- **Respondents:** Precision Realty…
- **Advocates:** Nishit D…; Yash Dh…; +3 more

## Timeline

- **2017-02-13 — Sanction…**: L & T Finance Limited sanctioned a Rupee Term Loan facility of INR 200 Crores to Kaa Vee…
- **2019-05-08 — Merger O…**: NCLT, Mumbai approved the Scheme of Merger by absorption between Kaa Vee Retail Infra…

## 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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