# In the matter of Ajay Kumar Radheshyam Goenka vs. Tourism Finance Corporation of India Ltd.

> SC judgment dated 2023-03-15. Citation: TCN-2023-SC-00092. M/s Rainbow Papers Limited, with Ajay Kumar Radheyshyam Goenka as Promoter and Managing Director,…

- **Court:** SC
- **Order date:** 15 Mar 2023
- **Citation:** TCN-2023-SC-00092
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/supreme-court-of-india/ajay-kumar-radheshyam-goenka-vs-tourism-finance-corporation-of-india-ltd-13ebdee0

## Summary

### Background

M/s Rainbow Papers Limited, with Ajay Kumar Radheyshyam Goenka as Promoter and Managing Director, sought loans from Tourism Finance Corporation of India Ltd. A loan agreement was executed on 2012-03-27. The Accused company issued a post-dated cheque which was dishonored due to 'Account Closed'. A demand-cum-legal notice was issued, but the debt remained unsettled. A criminal complaint was filed. Subsequently, an insolvency application was filed by Neeraj Paper Agencies Limited against the Accused company, which was admitted by the NCLT. The Respondent filed its claim in the N.I. Act proceedings. A resolution plan was filed, and the Respondent was considered an Unsecured Financial Creditor. The Metropolitan Magistrate dismissed the Appellant's application for exemption

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## Facts

M/s Rainbow Papers Limited, with Ajay Kumar Radheyshyam Goenka as the Promoter and Managing Director, obtained a loan of Rs. 30.00 crores from Tourism Finance Corporation of India Ltd. A loan agreement was executed on 2012-03-27 in New Delhi. To fulfill obligations under the agreement, the Accused company issued a post-dated cheque for Rs. 25,47,945/- dated 2016-02-15. The cheque was dishonored on 2016-04-07 with the remark 'Account Closed'. A demand-cum-legal notice was issued on 2016-04-19 under Section 138 of the Negotiable Instruments Act, 1881. The Accused acknowledged their liability on 2016-04-28 but did not pay. A criminal complaint was filed on 2016-05-16. In 2017, Neeraj Paper Agencies Limited filed an insolvency application under Section 9 of the IBC, which

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## Issues and analysis

### Issue 1: Whether during the pendency of the proceedings under the said Code which have been admitted, the …

**Ratio:** The scope and nature of proceedings under the IBC and the NI Act are quite different and

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**Reasoning:** The court reasoned that Section 138 of the NI Act is penal in character, aiming to

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**Interpretation:** The court interpreted Section 14 of the IBC to mean that the moratorium applies

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**Application:** The court applied the ratio to the facts by holding that the proceedings under

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## Parties

- **Judges:** SANJAY KISH…; ABHAY S…; +1 more
- **Appellants:** AJAY KUMAR…
- **Respondents:** Rainbow Papers…; Tourism Finance…

## Timeline

- **2012-03-27 — Loan Agreement…**: A Loan Agreement was executed…
- **2016-02-15 — Cheque I…**: Accused company issued post-dated cheque of Rs. 25,47,945/- bearing cheque number 090656…

## 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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