# In the matter of Maneesh Kumar Singh vs. State Bank of India & Ors.

> NCLAT judgment dated 2024-05-13. Citation: TCN-2024-NCLAT-00441. This appeal was filed by a Suspended Director of the Corporate Debtor, challenging the order…

- **Court:** NCLAT
- **Order date:** 13 May 2024
- **Citation:** TCN-2024-NCLAT-00441
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/maneesh-kumar-singh-vs-state-bank-of-india-ors-42e9b890

## Summary

### Background

This appeal was filed by a Suspended Director of the Corporate Debtor, challenging the order dated 10.11.2023 passed by the Adjudicating Authority (National Company Law Tribunal), Mumbai Bench, Court-IV, which admitted a Section 7 application filed by the State Bank of India. The Corporate Debtor, Advantage Overseas Pvt. Ltd., had been extended a financial facility by the State Bank of India, initially granted Rs.10 Crores on 15.03.2013. A Loan-cum-Hypothecation Agreement was executed on 23.03.2013. The Corporate Debtor defaulted, and the account was declared NPA on 08.08.2018. The State Bank of India filed an application under Section 7 on 13.03.2023, claiming Rs.2730,51,66,175.58/- as on 28.02.2023 with further interest.

## Facts

Advantage Overseas Pvt. Ltd. (Corporate Debtor) was extended financial facilities by State Bank of India (SBI). Initially, a facility of Rs. 10 Crores was granted on 15.03.2013. A Loan-cum-Hypothecation Agreement was executed on 23.03.2013. The facility was enhanced to Rs. 51 Crore, and a Letter of Arrangement was issued on 17.12.2014. In April 2016, the Corporate Debtor approached SBI for renewal and enhancement, leading to an extended facility of Rs. 6249.50 Crores via a Letter of Arrangement dated 13.04.2016. A Supplemental Agreement of Loan was executed on 12.05.2016. To secure the loan, Supplemental Deeds of Guarantee were executed. The Corporate Debtor defaulted, and SBI declared the account NPA on 08.08.2018. SBI issued a notice on 07.01.2019, demanding Rs.

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## Issues and analysis

### Issue 1: Whether the Section 7 application filed by the State Bank of India was barred by Section 10A of the …

**Ratio:** Section 10A of the IBC suspends the initiation of corporate insolvency resolution process

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**Reasoning:** The NCLAT reasoned that the initial default occurred on 08.08.2018, which is prior to the

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**Interpretation:** Section 10A is interpreted to mean that if the initial default occurred before

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**Application:** In this case, the initial default occurred on 08.08.2018, before the 10A

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## Parties

- **Judges:** Ashok Bh…; Barun M…
- **Appellants:** Maneesh Kumar…
- **Respondents:** Advantage…; State Bank of…
- **Advocates:** Abhijeet…; Anuj Ti…; +6 more

## Timeline

- **2013-03-15 — Initial Facilit…**: State Bank of India granted a financial facility of Rs. 10 Crores to Advantage Overseas…
- **2013-03-23 — Loan-cum-Hypothecation…**: A Loan-cum-Hypothecation Agreement was executed between State Bank of India and Advantage…

## 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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