# In the matter of Shaila Clubs and Resorts Private Limited

> NCLT judgment dated 2023-07-28. Citation: TCN-2023-NCLT-02297. The case involves a Company Petition filed under Section 7 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 28 Jul 2023
- **Citation:** TCN-2023-NCLT-02297
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/shaila-clubs-and-resorts-private-limited-e319941d

## Summary

### Background

The case involves a Company Petition filed under Section 7 of the Insolvency and Bankruptcy Code, 2016, by Savannah Lifestyle Private Limited against Shaila Clubs and Resorts Private Limited, alleging default in payment of a financial debt. The Corporate Debtor was incorporated in 2005. The Financial Creditor claims that the Corporate Debtor failed to pay an outstanding financial debt of Rs. 9,16,43,081/-. The Corporate Debtor had availed a loan from Vasantdada Shetkari Sahakari Bank, which was later assigned to the Financial Creditor. The Corporate Debtor raised the issue of limitation, arguing that the petition was filed after the limitation period. The Corporate Debtor also argued that there was no outstanding financial debt owed to the Financial Creditor and that

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## Facts

Savannah Lifestyle Private Limited filed a Company Petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Shaila Clubs and Resorts Private Limited, alleging default in payment of a financial debt. The Corporate Debtor was incorporated on 02.05.2005. The Financial Creditor claimed an outstanding financial debt of Rs. 9,16,43,081/-, with a principal amount of Rs. 8,97,73,098/- and interest at 16% p.a. The default occurred on 07.05.2005, when the loan account was declared a Non-Performing Asset. The Corporate Debtor had availed a loan of Rs. 4,75,00,000/- from Vasantdada Shetkari Sahakari Bank, which issued a Recovery Certificate on 23.02.2012. A prior CIRP was initiated against the Corporate Debtor on 29.10.2021. The Bank filed a claim of Rs.

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## Issues and analysis

### Issue 1: Whether the Company Petition filed by the Financial Creditor is maintainable under Section 7 of the …

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

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**Reasoning:** The court found that the Financial Creditor had demonstrated the existence of a financial

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

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**Application:** The court applied Section 7 to the facts of the case, finding that the

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## Parties

- **Judges:** Shyam Babu…; Kuldip Kumar…
- **Appellants:** Savannah Lifestyle…
- **Respondents:** Shaila Clubs And…
- **Advocates:** Shivani Bh…; Rahul S…; +7 more

## Timeline

- **2005-05-02 — Incorporation of…**: Shaila Clubs and Resorts…
- **2005-05-07 — Default…**: The loan account was declared…

## 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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