# In the matter of Vidarbha Industries Private Limited

> NCLT judgment dated 2024-09-30. Citation: TCN-2024-NCLT-00524. The case involves two Company Petitions, C.P. (IB) No. 264/MB/2020 and 1234/MB/2022, filed by…

- **Court:** NCLT
- **Order date:** 30 Sept 2024
- **Citation:** TCN-2024-NCLT-00524
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/vidarbha-industries-private-limited-b568aac8

## Summary

### Background

The case involves two Company Petitions, C.P. (IB) No. 264/MB/2020 and 1234/MB/2022, filed by Axis Bank Limited and State Bank of India, respectively, under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC), seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Vidarbha Industries Private Limited (Corporate Debtor). The petitions were based on alleged defaults of Rs. 553,27,99,322/- and Rs. 2378.63 Crore, respectively. The Corporate Debtor (CD) challenged the maintainability of the Main C.P. before Bench-II (Special Bench) of this Tribunal. The CD prayed for stay of the Main C.P. until final hearing and disposal of the proceedings pending before various authorities. The matter had a complex history, including appeals to the Supreme Court

…

## Facts

Vidarbha Industries Private Limited (VIPL), a special purpose vehicle, was incorporated to set up a 600 MW coal-based thermal power plant. It availed a loan of Rs. 749 Crore from a consortium of lenders, including Axis Bank Limited and State Bank of India. Due to non-payment of debt, the CD's account was classified as a Non-Performing Asset on 28.06.2019. Axis Bank Limited and State Bank of India filed applications under Section 7 of the IBC. Later, both assigned their debts to CFM Asset Reconstruction Private Limited (CFM). The CD's plant at Nagpur has been out of operation since 2019. The CD acknowledged the debt due to the lenders. The CD informed the lenders about poor revenue generation and lack of funds. The CD contended that it was unable to pay dues due to the

…

## Issues and analysis

### Issue 1: Whether the application for initiating CIRP against the Corporate Debtor should be admitted under …

**Ratio:** The Adjudicating Authority (NCLT) has the discretion to admit the application of the

…

**Reasoning:** The Tribunal considered the Supreme Court's guidance on the discretion to admit or reject

…

**Interpretation:** Section 7 of the IBC provides the framework for initiating CIRP by a financial

…

**Application:** The Tribunal applied the principle of discretion under Section 7 of the IBC and

…

## Parties

- **Judges:** K. R. SAJI…; SANJIV…
- **Appellants:** CFM Asset…
- **Respondents:** VIDARBHA INDUSTRIE…

## Timeline

- **2020-01-17 — Filing of C.P. (IB) No.…**: Axis Bank Limited filed C.P. (IB) No.…
- **2022-11-14 — Filing of C.P. (IB) No.…**: State Bank of India filed C.P. (IB) No.…

## 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)

---

This is a preview. The full structured summary, issues, precedents and source judgment are available on CaseEase - Legal Intelligence Simplified: https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/vidarbha-industries-private-limited-b568aac8