Section 7 insolvency demands documentary proof of financial debt and default; absence of a financial contract defeats admission.

A section 7 insolvency application requires the financial creditor to show a financial debt and default through a discernible financial contract or equivalent supporting material setting out the lending terms, including tenure, interest, and repayment conditions. Where no financial agreement or other documentary record evidences the alleged lending arrangement, the Tribunal cannot resolve the dispute through oral controversy in a summary proceeding. Without proof of the contractual basis and default, the alleged non-payment cannot be ascertained, and insolvency admission cannot be sustained; the application was therefore held not maintainable and dismissed.

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Issues: Whether a section 7 insolvency application was maintainable in the absence of a financial contract and sufficient proof of default.

Analysis: An application by a financial creditor under the insolvency framework must be supported by the requisite documents showing the terms of the financial debt, including the tenure, interest, and repayment conditions. The record did not disclose any financial contract or financial agreement evidencing the alleged lending arrangement. In a summary proceeding of this nature, the Tribunal could not enter upon oral controversies to determine the existence of such an agreement. Since default had to be established on the basis of the contractual terms and supporting material, and no such material was produced, the alleged default could not be ascertained.

Conclusion: The application was not maintainable and was dismissed.

Ratio Decidendi: In a section 7 proceeding, the applicant must establish the financial debt and default through a discernible financial contract or equivalent supporting material; in its absence, insolvency admission cannot be sustained.

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