# In the matter of RNV Hospitality Services Private Limited IA No.158-ALD-2022 in CP (IB) No. 489-ALD-2019

> NCLT judgment dated 2022-06-13. Citation: TCN-2022-NCLT-02243. The case pertains to an application filed under Section 7 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 13 Jun 2022
- **Citation:** TCN-2022-NCLT-02243
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/rnv-hospitality-services-private-limited-ia-no158-ald-2022-in-cp-ib-no-489-ald-2-2bf77f97

## Summary

### Background

The case pertains to an application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016, by M/s Pallia Transport Company (Financial Creditor) against RNV Hospitality Services Private Limited (Corporate Debtor) seeking initiation of Corporate Insolvency Resolution Process (CIRP). The financial creditor had granted a bridge loan to the corporate debtor for funding the acquisition or construction of a Micro Brewery at Gurugram. The loan amount was ₹30,00,000 with an interest rate of 24% per annum, to be repaid through weekly installments starting from 10.10.2016, with the last installment due on 13.02.2017. The corporate debtor defaulted on the repayment.

## Facts

M/s Pallia Transport Company (Financial Creditor) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against RNV Hospitality Services Private Limited (Corporate Debtor) seeking initiation of Corporate Insolvency Resolution Process (CIRP). The Financial Creditor had extended a bridge loan of ₹30,00,000 to the Corporate Debtor to fund the acquisition or construction of a Micro Brewery at Gurugram. The loan carried an interest rate of 24% per annum and was to be repaid through weekly installments starting from 10.10.2016, with the final installment due on 13.02.2017. The Corporate Debtor defaulted on the repayment, with the amount of default stated as ₹32,10,267. The first date of default was 10.10.2016, and the last date of default was

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## Issues and analysis

### Issue 1: Whether the application filed by the Financial Creditor under Section 7 of the Insolvency & …

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

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**Reasoning:** The Adjudicating Authority considered the evidence presented by the Financial Creditor,

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

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**Application:** The Adjudicating Authority found that the Financial Creditor had provided

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## Parties

- **Judges:** Rajasekha…; Virendra Kumar…
- **Appellants:** M/s Pallia…
- **Respondents:** RNV Hospitality…

## Timeline

- **2016-10-10 — First Date of…**: The first date of default on the loan…
- **2017-02-13 — Last Date of…**: The last date of default on the loan…

## 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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