# Kotak Mahindra Bank Ltd. vs. IDBI Bank Limted, Ms. Jovita Reema Mathias, State Bank of India, Edelweiss Asset Reconstruction Company Ltd. & Standard Chartered Bank

> NCLAT judgment dated 24 Apr 2026. Citation: TCN-2026-NCLAT-00138. This case involves three connected appeals filed by Kotak Mahindra Bank Ltd. before the…

- **Court:** NCLAT
- **Order date:** 24 Apr 2026
- **Citation:** TCN-2026-NCLAT-00138
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/kotak-mahindra-bank-ltd-vs-idbi-bank-limted-ms-jovita-reema-mathias-state-bank-o-9bcf916a

## Summary

### Background

This case involves three connected appeals filed by Kotak Mahindra Bank Ltd. before the National Company Law Appellate Tribunal (NCLAT), challenging orders passed by the National Company Law Tribunal (NCLT), Mumbai Bench-I (Adjudicating Authority). The disputes revolve around the classification of claims by various financial creditors (IDBI Bank Ltd., State Bank of India, Kotak Mahindra Bank Ltd., Edelweiss Asset Reconstruction Company Ltd., and Standard Chartered Bank) in the liquidation process of Gupta Synthetics Ltd. (Corporate Debtor - CD). Financial facilities were extended to the CD by a consortium of banks, with charges created and registered in 2006 and 2008. Subsequently, these facilities were restructured, leading to questions about whether re-registration

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## Facts

Financial facilities were initially extended to Gupta Synthetics Ltd. (CD) in 2004 by VYSYA Bank Ltd., Bank of Baroda (BoB), and Oriental Bank of Commerce (OBC).

Subsequently, Standard Chartered Bank (SCB), IDBI Bank Ltd., State Bank of India (SBI), and State Bank of Saurashtra (SBS) were inducted into the consortium, while BoB exited.

VYSYA Bank Ltd. later merged with Kotak Mahindra Bank Ltd., and State Bank of Saurashtra merged with SBI.

IDBI Bank Ltd. sanctioned a term loan of Rs. 17.60 Crores on 21.06.2006 and working capital facilities of Rs. 10 Crores on 25.07.2006 to the CD.

A supplemental joint deed of hypothecation was executed on 23.08.2006, and a memorandum of deposit of title deeds was executed on 07.12.2006, creating security for IDBI Bank's facilities.

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## Issues and analysis

### Issue 1: Whether the classification of claims by Respondent SBI and IDBI Bank Ltd. as secured creditors is …

**Ratio:** Regulation 21 of the IBBI (Liquidation Process) Regulations, 2016, provides alternative

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**Reasoning:** The Adjudicating Authority's liberal construction of 'modification' was upheld, reasoning

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**Interpretation:** The court interpreted 'modification of charge' narrowly in the context of debt

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**Application:** In the case of IDBI Bank and SBI, their original charges were duly registered.

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## Parties

- **Judges:** Mohd. Faiz Alam…; Indevar P…
- **Appellants:** Kotak Mahindra…
- **Respondents:** Gupta Synthetics…; IDBI Bank…; +4 more
- **Other parties:** Insolvency and…; Companie…; +16 more

## Timeline

- **2004 — Initial Financial…**: Financial facilities extended to Gupta Synthetics Ltd. (CD) by VYSYA Bank Ltd., Bank of…
- **2006-06-21 — IDBI Bank Sanctions…**: IDBI Bank Ltd. sanctioned a term…

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