# In the matter of Shah Group Builders & Infraprojects Limited CP (IB) No.937-MB-IV-2021

> NCLT judgment dated 2022-06-06. Citation: TCN-2022-NCLT-02370. The case involves an application filed by Interglobe Finance Limited, the Financial Creditor,…

- **Court:** NCLT
- **Order date:** 6 Jun 2022
- **Citation:** TCN-2022-NCLT-02370
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/shah-group-builders-infraprojects-limited-cp-ib-no937-mb-iv-2021-074892fd

## Summary

### Background

The case involves an application filed by Interglobe Finance Limited, the Financial Creditor, against Shah Group Builders & Infraprojects Limited, the Corporate Debtor, under Section 7 of the Insolvency & Bankruptcy Code, 2016, for initiating the Corporate Insolvency Resolution Process (CIRP). The Financial Creditor claimed a total default of Rs. 1,48,91,068/-, including a principal amount of Rs. 1,09,49,315/- and interest of Rs. 39,41,753/-. The Date of Default was mentioned as 15.07.2019, and the Petition was filed on 04.10.2021.

## Facts

Interglobe Finance Limited, a listed NBFC, extended a business loan of Rs. 2,00,00,000 to Shah Group Builders & Infraprojects Limited. The loan, disbursed on 03.06.2014, was extended multiple times. The Corporate Debtor issued post-dated cheques to the Financial Creditor as security for the loan amount, which were subsequently dishonoured. The Financial Creditor initiated legal action under Section 138 of the Negotiable Instruments Act due to the dishonoured cheques. A prior Company Application was filed by the Financial Creditor to recover the outstanding debt of Rs. 2,69,49,315/-, which included principal and interest as of 05.03.2018. A settlement agreement was reached between the parties, resulting in the withdrawal of the Company Application. As part of the

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## Issues and analysis

### Issue 1: Whether the application filed by the Financial Creditor under Section 7 of the I&B Code is …

**Ratio:** Section 7 of the I&B Code allows a financial creditor to initiate CIRP against a

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**Reasoning:** The NCLT found that the application was complete and filed under the proper form, and the

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**Interpretation:** Section 7 provides the mechanism for financial creditors to trigger the

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**Application:** The NCLT determined that the application met all the requirements under Section

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## Parties

- **Judges:** RAJESH S…; KISHORE VEMULAPALL…
- **Appellants:** Interglobe…
- **Respondents:** Shah Group…
- **Advocates:** Gauraj…; Rohit G…

## Timeline

- **2014-06-03 — Loan Disb…**: Financial Creditor disbursed a Business Loan of…
- **2015-12-01 — Loan Agre…**: Loan Agreement dated 01.12.2015 at pp. 27-29,…

## 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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