# In the matter of Vijay Engineering Equipment India Private Limited CP (IB) No. 7-7-AMR-2022

> NCLT judgment dated 2022-10-26. Citation: TCN-2022-NCLT-00616. SREI Equipment Finance Limited, the Financial Creditor (FC), filed a Company Petition against…

- **Court:** NCLT
- **Order date:** 26 Oct 2022
- **Citation:** TCN-2022-NCLT-00616
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/vijay-engineering-equipment-india-private-limited-cp-ib-no-7-7-amr-2022-1a5391e7

## Summary

### Background

SREI Equipment Finance Limited, the Financial Creditor (FC), filed a Company Petition against Vijay Engineering Equipment India Private Limited, the Corporate Debtor (CD), seeking to initiate Corporate Insolvency Resolution Process (CIRP) due to a default of Rs. 149,28,72,738. The FC claimed to have extended credit facilities of Rs. 100 Crores to the CD through 12 Master Facility Agreements dated 01.10.2018, secured by hypothecation deeds. The CD denied the debt, asserting full repayment of Rs. 100 Crores, supported by bank statements.

## Facts

SREI Equipment Finance Limited (FC), a non-banking financial company, filed a petition against Vijay Engineering Equipment India Private Limited (CD) to initiate CIRP, claiming a default of Rs. 149,28,72,738. The FC had extended credit facilities of Rs. 100 Crores to the CD through 12 Master Facility Agreements dated 01.10.2018, secured by hypothecation deeds. The CD denied the debt, asserting full repayment of Rs. 100 Crores in various tranches between 05.09.2018 and 28.12.2018, supported by bank statements. A demand notice was issued on 10.11.2021, which was received by the CD, but no reply was issued. The FC filed a ledger account showing the debt, while the CD relied on bank statements indicating complete repayment. The CD also argued that the FC had filed a

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor committed a default …

**Ratio:** The burden of proof lies on the Financial Creditor to establish the existence of a debt

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**Reasoning:** The Tribunal considered the evidence presented by both parties, including the ledger

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**Interpretation:** The interpretation of 'default' under the Insolvency and Bankruptcy Code

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**Application:** In this case, the Tribunal found that the bank statements provided by the CD

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## Parties

- **Judges:** TELAPROLU…
- **Appellants:** SREI Equipment…
- **Respondents:** Vijay Engineering…

## Timeline

- **2018-10-01 — Master Facility…**: SREI Equipment Finance Limited extended credit facilities of Rs. 100 Crores to Vijay…
- **2018-10-01 — Hypothecatio…**: Vijay Engineering Equipment India Private Limited executed two deeds of Hypothecation in…

## 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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