# In the matter of Takshashila Heights India Pvt. Ltd.

> NCLT judgment dated 2024-11-06. Citation: TCN-2024-NCLT-00296. Edelweiss Asset Reconstruction Company Limited filed an application under Section 7 of the…

- **Court:** NCLT
- **Order date:** 6 Nov 2024
- **Citation:** TCN-2024-NCLT-00296
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/takshashila-heights-india-pvt-ltd-1297d9b8

## Summary

### Background

Edelweiss Asset Reconstruction Company Limited filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Takshashila Heights India Pvt. Ltd., the Corporate Debtor. The applicant, acting as a trustee of EARC Trust, claimed that the Corporate Debtor defaulted on loan repayments. The original lender, ECL Finance Ltd., had sanctioned financial assistance to the Corporate Debtor, which was later assigned to the applicant. The Corporate Debtor's object was changed in 2018 and involved construction and development of a residential cum commercial project. The respondent objected to the application, citing delays due to legal and statutory approvals and the COVID-19 pandemic. They

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## Facts

Edelweiss Asset Reconstruction Company Limited (EARC), acting as a trustee, filed an application under Section 7 of the Insolvency and Bankruptcy Code (IBC) to initiate Corporate Insolvency Resolution Process (CIRP) against Takshashila Heights India Pvt. Ltd. (Corporate Debtor). EARC claimed the Corporate Debtor defaulted on loan repayments. The original lender, ECL Finance Ltd., had sanctioned a Term Loan Facility-I of Rs. 40 crore on 19.07.2018 and a Term Loan Facility-II of Rs. 30 crore on 19.07.2018. The Corporate Debtor executed loan agreements and personal guarantees were provided by Mr. Kamlesh Gondalia, Mrs. Deeptiben Gondalia, and Mr. Parthil Gondalia. The Corporate Debtor's account was classified as NPA on 30.12.2021, with outstanding dues of Rs.

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## Issues and analysis

### Issue 1: Whether the application for initiating CIRP against the Corporate Debtor is maintainable under …

**Ratio:** The initiation of CIRP under Section 7 of the IBC requires the existence of a debt and a

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**Reasoning:** The court reasoned that while a debt and default existed, the applicant's conduct

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**Interpretation:** Section 7 of the IBC should be interpreted in a manner that promotes the

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**Application:** In this case, the court found that the applicant's actions, including

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## Parties

- **Judges:** Chitra Ha…; Velamur G Venkata…
- **Appellants:** Edelweiss Asset…
- **Respondents:** Takshashila…; Takshashila…

## Timeline

- **2018-07-19 — Term Loan Facility-I…**: Original lender sanctioned Term Loan Facility-I…
- **2018-07-19 — Term Loan Facility-II…**: Original lender sanctioned Term Loan…

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