# In the matter of VA Realcon Private Limited C.P. (IB)-721 (PB)-2021

> NCLT judgment dated 2022-04-07. Citation: TCN-2022-NCLT-03325. The case pertains to an application filed by M/s. Utsav Securities Private Limited, the…

- **Court:** NCLT
- **Order date:** 7 Apr 2022
- **Citation:** TCN-2022-NCLT-03325
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/va-realcon-private-limited-cp-ib-721-pb-2021-a91c9340

## Summary

### Background

The case pertains to an application filed by M/s. Utsav Securities Private Limited, the Financial Creditor (FC), under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016, read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, for initiating Corporate Insolvency Resolution Process (CIRP) against M/s. VA Realcon Private Limited, the Corporate Debtor (CD). The FC claimed that the CD defaulted on a loan agreement. The CD acknowledged the debt but cited economic hardship due to COVID-19 as the reason for its inability to repay.

## Facts

M/s. Utsav Securities Private Limited (Financial Creditor/Applicant) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against M/s. VA Realcon Private Limited (Corporate Debtor/Respondent). The Financial Creditor and Corporate Debtor entered into a loan agreement on 2021-02-25, where the Financial Creditor agreed to grant a loan of up to Rs. 1,30,00,000/- to the Corporate Debtor, with an interest rate of 8% per annum for a period of 6 months. The Financial Creditor disbursed the loan amount to the Corporate Debtor. The Corporate Debtor defaulted on the repayment of the loan, with the date of default being 2021-07-26. The outstanding amount, including interest, was Rs.

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## Issues and analysis

### Issue 1: Whether the application filed by the Financial Creditor under Section 7 of the Insolvency and …

**Ratio:** Section 7 of the Insolvency and Bankruptcy Code, 2016, stipulates the requirements for

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**Reasoning:** The NCLT examined the application and found that it was complete and in compliance with

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

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**Application:** The Financial Creditor's application was found to be complete and demonstrated

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## Parties

- **Judges:** SHRI. ABNI RANJAN…; SHRI. HEMANT…
- **Appellants:** M/s. Utsav…
- **Respondents:** M/s. VA Realcon…

## Timeline

- **2021-02-25 — Loan Agre…**: Loan agreement entered into between M/s. Utsav Securities Private Limited and M/s. VA…
- **2021-07-26 — Date of D…**: M/s. VA Realcon Private Limited…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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