# In the matter of Taquito Lease Operators Limited

> NCLT judgment dated 2023-11-10. Citation: TCN-2023-NCLT-00767. The case involves a Company Petition (IB)-419(MB)/2023 filed under Section 7 of the Insolvency…

- **Court:** NCLT
- **Order date:** 10 Nov 2023
- **Citation:** TCN-2023-NCLT-00767
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/taquito-lease-operators-limited-ba1e5dea

## Summary

### Background

The case involves a Company Petition (IB)-419(MB)/2023 filed under Section 7 of the Insolvency and Bankruptcy Code, 2016, by Centbank Financial Services Limited (“Financial Creditor”) against M/s Taquito Lease Operators Limited (“Corporate Debtor”). The Financial Creditor initiated the Corporate Insolvency Resolution Process (“CIRP”) due to the Corporate Debtor's default in repaying an amount of ₹321,71,71,304.63 as of 31.03.2022. The Corporate Debtor had issued debentures and later requested a one-time restructuring, which was approved by the Debenture Holder. Despite the restructuring, the Corporate Debtor failed to fulfill its obligations, leading to the issuance of a demand notice and subsequent recall of the entire loan amount.

## Facts

Centbank Financial Services Limited, the Financial Creditor, filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate CIRP against M/s Taquito Lease Operators Limited, the Corporate Debtor, due to a default of ₹321,71,71,304.63 as of 31.03.2022. The Corporate Debtor had issued 3000 secured, rated, redeemable, non-convertible debentures in 2018, each with a face value of INR 10,00,000. Punjab National Bank subscribed to 2550 debentures. Centbank Financial Services Limited was appointed as the debenture trustee. Due to failure to pay the debt, the Corporate Debtor requested a one-time restructuring, which was approved, and a restructuring sanction letter was issued on 16.06.2021. Despite the restructuring, the Corporate Debtor failed to

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority should admit the application under Section 7 of the Insolvency …

**Ratio:** The Adjudicating Authority has to determine whether a 'debt' (which may be disputed) was

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**Reasoning:** The Adjudicating Authority relied on the judgment in Innoventive Industries Limited vs.

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**Interpretation:** The legal principle is that if a default has occurred, the Adjudicating

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**Application:** In this case, the Adjudicating Authority found that the existence of debt and

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## Parties

- **Judges:** Charanjeet Singh…; Smt Lakshmi…
- **Appellants:** Centbank Financial…
- **Respondents:** M/s. Taquito…
- **Advocates:** Shwetaank…; Disha Mo…; +1 more

## Timeline

- **2018-01-09 — Debenture Subs…**: Punjab National Bank subscribed to 2550 Debentures for an aggregate nominal value of INR…
- **2018-02-22 — Debenture Trustee…**: Debenture Trustee Agreement executed between the Corporate Debtor and the Debenture…

## 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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