There are two types of NMD-7. I am assuming the NMD-7 you are referring to is a vinyl-coated cable and not the cloth-covered cable. We cannot vouch for the shape the cable is in without being on site.
I am not saying you can't use it, but may cause a few problems.
First, obviously, it is used therefore it does not have the same life as the new cable so it is likely to cause a problem before the rest of the system.
Second, how are you handling the splice? It needs to be maintained, meaning it needs to be protected and available for maintenance, usually in a box and cover.
From a contractor's point of view it would not be allowed since it would pose too much of a liability.
In short if you are installing a new circuit, and to insure a quality installation, you should install all new components with a minimum of splices. It usually pays off in the long run.
As far as passing inspection, I don't believe any of us can give you an answer since that is a decision of the AHJ, and we don't know their way of thinking. I would suggest you contact them and discuss it. Believe it or not they are there to help you. You pay their salary and they work for you as well as the community they serve.