# In the matter of Zee Learn Limited CP (IB) 301-MB-C-1-2022

> NCLT judgment dated 2023-02-10. Citation: TCN-2023-NCLT-04621. Yes Bank Limited initiated a Corporate Insolvency Resolution Process (CIRP) against Zee Learn…

- **Court:** NCLT
- **Order date:** 10 Feb 2023
- **Citation:** TCN-2023-NCLT-04621
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/zee-learn-limited-cp-ib-301-mb-c-1-2022-1a2bb917

## Summary

### Background

Yes Bank Limited initiated a Corporate Insolvency Resolution Process (CIRP) against Zee Learn Limited under Section 7 of the Insolvency and Bankruptcy Code, 2016, alleging a default on financial debt. The petition was based on Zee Learn Limited's guarantee for loans extended to Zee Learn Education Society, Gyanmala Public Education Trust, Mount Litera Education Foundation, and Taleem Research Foundation. The financial creditor claimed a total default of Rs. 4,689,990,947.45 as of 02.08.2021, comprising principal and interest. The corporate debtor contested the petition, raising issues of maintainability, NPA classification, moratorium benefits, and the validity of the guarantee.

## Facts

Yes Bank Limited, the Financial Creditor, filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Zee Learn Limited, the Corporate Debtor. The petition was based on the Corporate Debtor's guarantee for loans extended to Zee Learn Education Society, Gyanmala Public Education Trust, Mount Litera Education Foundation, and Taleem Research Foundation. Facility Letters were issued on 30.03.2016 to the three borrowers, Zee Learn Education Society, Gyanmala Public Education Trust, and Mount Litera Education Foundation. Loan Agreements and Master Facility Agreements were entered into on 20.06.2016 between the Financial Creditors and the Borrowers. A facility letter dated 22.03.2018 was

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor's account could be declared as NPA, considering Section 10A of the …

**Ratio:** Section 10A of the IBC prohibits the initiation of CIRP for defaults occurring during a

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**Reasoning:** The NCLT considered the Corporate Debtor's argument that the accounts of the borrowers

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**Interpretation:** Section 10A provides a temporary bar on initiating CIRP for defaults occurring

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**Application:** The NCLT held that Section 10A did not apply to the present case because the

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## Parties

- **Judges:** P.N. Des…; Shyam Babu…
- **Appellants:** Yes Bank L…
- **Respondents:** Zee Learn L…

## Timeline

- **2016-03-30 — Facility Lette…**: Financial Creditor issued Facility Letters to Zee Learn Education Society, Gyanmala…
- **2016-06-20 — Loan and Master…**: Loan Agreements and Master Facility Agreements were entered into between the Financial…

## 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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