# In the matter of Sevenhills Healthcare Pvt. Ltd.

> NCLT judgment dated 2024-02-02. Citation: TCN-2024-NCLT-02789. The Municipal Corporation of Greater Mumbai (MCGM) initiated a tender process for the…

- **Court:** NCLT
- **Order date:** 2 Feb 2024
- **Citation:** TCN-2024-NCLT-02789
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/sevenhills-healthcare-pvt-ltd-086fcaa7

## Summary

### Background

The Municipal Corporation of Greater Mumbai (MCGM) initiated a tender process for the development of BMC Land, selecting Seven Hills Healthcare Private Limited (Corporate Debtor/CD) as the successful bidder in 2004. A Letter of Possession was issued, granting CD possession of the BMC Land to construct a hospital. Subsequently, a Contract Agreement formalized the arrangement, obligating CD to develop and operate a hospital. The agreement stipulated obligations, including completing the hospital within 60 months and reserving 20% of beds for Municipal Employees and citizens with specific ration cards. A Memorandum of Understanding (MOU) was executed in 2013 to implement the bed reservation commitments. The corporate debtor failed to fulfill payment obligations and

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## Facts

In 2004, Seven Hills Healthcare Private Limited (Corporate Debtor) was selected as the successful bidder for the development of BMC Land through a tender process initiated by the Municipal Corporation of Greater Mumbai (MCGM). A Letter of Possession was issued, granting the Corporate Debtor possession of the BMC Land to construct a hospital. Subsequently, a Contract Agreement formalized the arrangement, obligating the Corporate Debtor to develop and operate a hospital. The agreement stipulated obligations, including completing the hospital within 60 months and reserving 20% of beds for Municipal Employees and citizens with specific ration cards. A Memorandum of Understanding (MOU) was executed in 2013 to implement the bed reservation commitments. The Corporate Debtor

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## Issues and analysis

### Issue 1: Whether the rights conferred/flown in favour of the corporate debtor and the lenders under the …

**Ratio:** The NCLT relied on Victory Iron Works Ltd. vs Jitendra Lohia, 2023 Live Law (SC), to hold

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**Reasoning:** The NCLT reasoned that the corporate debtor possessed a variety of rights under the

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**Interpretation:** The NCLT interpreted Section 18(1)(f) and Section 25(2)(a) of the IBC, along

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**Application:** The NCLT applied the ratio and reasoning to the facts of the case, holding that

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## Parties

- **Judges:** Venkata Ramakrishn…
- **Appellants:** Municipal…
- **Respondents:** SEVENHILLS…; Abhilas…

## Timeline

- **2004-01-01 — Selection of Corporate…**: Seven Hills Healthcare Private Limited selected as successful bidder for development of…
- **2004-07-12 — Letter of Pos…**: Letter of Possession issued to…

## 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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