# In the matter of Siri Longview Tea & Agro Limited I.A (IB) No. 356-KB-2022
in C.P (IB) No. 449-KB-2020

> NCLT judgment dated 2022-05-12. Citation: TCN-2022-NCLT-02767. Oversure Enterprises Private Limited filed a petition under Section 7 of the Insolvency and…

- **Court:** NCLT
- **Order date:** 12 May 2022
- **Citation:** TCN-2022-NCLT-02767
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/siri-longview-tea-agro-limited-ia-ib-no-356-kb-2022-in-cp-ib-no-449-kb-2020-e68bb167

## Summary

### Background

Oversure Enterprises Private Limited filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Siri Longview Tea & Agro Limited, alleging default on a loan of Rs. 25,00,000 with 12% interest. The Financial Creditor claimed a total default of Rs. 25,25,000 as of December 31, 2019. The Corporate Debtor denied the debt and claimed that the Financial Creditor is a shell company providing accommodation entries. The Income Tax Department also issued notices and assessment orders against the Corporate Debtor regarding the loan transaction.

## Facts

Oversure Enterprises Private Limited (Financial Creditor) filed a petition against Siri Longview Tea & Agro Limited (Corporate Debtor) under Section 7 of the Insolvency and Bankruptcy Code, 2016, claiming a default on a loan of Rs. 25,00,000 with 12% interest. The Financial Creditor transferred Rs. 25,00,000 to the Corporate Debtor on August 3, 2016. The Corporate Debtor issued a cheque for repayment, which was dishonored due to insufficient funds. The Financial Creditor issued a notice under Section 138 of the Negotiable Instruments Act, 1881. The Corporate Debtor admitted the debt in a letter dated September 27, 2019, but claimed the Financial Creditor was a shell company. The Income Tax Department issued notices and assessment orders against the Corporate

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## Issues and analysis

### Issue 1: Whether the transaction between Oversure Enterprises Private Limited and Siri Longview Tea & …

**Ratio:** A 'Financial Debt' must meet the criteria defined under the Insolvency and Bankruptcy

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**Reasoning:** The court considered the submissions of both parties and the findings of the Income Tax

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**Interpretation:** The interpretation of 'Financial Debt' requires a genuine transaction where

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**Application:** In this case, the court found that the Income Tax Department's findings cast

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## Parties

- **Judges:** Rajasekha…; Balraj…
- **Respondents:** Siri Longview Tea…; Oversure Enterpris…

## Timeline

- **2016-08-03 — Loan Disbur…**: Oversure Enterprises Private Limited transferred Rs. 25,00,000 to Siri Longview Tea &…
- **2019-07-30 — Cheque I…**: Siri Longview Tea & Agro Limited issued…

## 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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