# In the matter of Reliance Infrastructure Consulting & Engineers Pvt. Ltd.

> NCLT judgment dated 2023-09-08. Citation: TCN-2023-NCLT-01744. Axis Trustee Services Limited, the Financial Creditor, filed a petition under Section 7 of the…

- **Court:** NCLT
- **Order date:** 8 Sept 2023
- **Citation:** TCN-2023-NCLT-01744
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/reliance-infrastructure-consulting-engineers-pvt-ltd-ac6f9383

## Summary

### Background

Axis Trustee Services Limited, the Financial Creditor, filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Reliance Infrastructure Consulting & Engineers Pvt. Ltd., the Corporate Debtor, due to an unresolved financial debt of Rs. 433,29,03,792 as of June 6, 2022. The Financial Creditor had subscribed to unlisted, rated, redeemable, and non-convertible debentures. The Corporate Debtor defaulted on payments, leading to the invocation of corporate guarantees. The Corporate Debtor opposed the petition, citing issues with the stamping of documents and pending arbitration proceedings.

## Facts

Axis Trustee Services Limited (Financial Creditor) filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate CIRP against Reliance Infrastructure Consulting & Engineers Pvt. Ltd. (Corporate Debtor). The claim was based on a financial debt of Rs. 433,29,03,792 as of 06.06.2022. The Financial Creditor had subscribed to 6,500 unlisted, rated, redeemable, and non-convertible debentures of Rs. 10 Lakhs each. The Corporate Debtor was required to maintain a security cover, which fell short in February 2019, leading to a mandatory prepayment event. The Corporate Debtor acknowledged its liability in a Deed of Undertaking dated 22.05.2019 and committed to pay Rs. 200,00,00,000 by 30.06.2019. The Corporate Debtor failed to deposit the amounts,

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## Issues and analysis

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

**Ratio:** The insufficiency of stamp duty on documents does not preclude the consideration of an

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**Reasoning:** The NCLT reasoned that proceedings under Section 7 of the Code are not recovery

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**Interpretation:** The interpretation of Section 7 of the IBC emphasizes the resolution of

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**Application:** The NCLT applied the ratio to the facts of the case, noting that the Financial

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## Parties

- **Judges:** ANIL RAJ C…; Kuldip Kumar…
- **Appellants:** Axis Trustee…
- **Respondents:** Reliance Infrastru…
- **Advocates:** Mustafa D…; Suchitra…; +5 more

## Timeline

- **2017-12-14 — Transaction Documents…**: Various Transaction Documents were…
- **2019-02-01 — Fall in Securi…**: Due to a fall in the security cover, a…

## 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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