# In the matter of State Bank of India Vs. Debashish Nanda CA (AT) No. 49-2018

> NCLAT judgment dated 2018-04-27. Citation: TCN-2018-NCLAT-00314. State Bank of India (SBI) filed an appeal against an order dated January 25, 2018, passed by…

- **Court:** NCLAT
- **Order date:** 27 Apr 2018
- **Citation:** TCN-2018-NCLAT-00314
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/state-bank-of-india-vs-debashish-nanda-ca-aa980b09

## Summary

### Background

State Bank of India (SBI) filed an appeal against an order dated January 25, 2018, passed by the Adjudicating Authority (National Company Law Tribunal), Principal Bench, New Delhi. The order related to the imposition of a cost of Rs. 25,000 on the non-applicant/respondent and directions to roll back debit entries adjusted in the account of the Corporate Debtor after June 1, 2017, and restore the account to its state as of that date. The appeal also concerned the moratorium declared under Section 7 of the Insolvency and Bankruptcy Code (IBC).

## Facts

On January 25, 2018, the Adjudicating Authority (National Company Law Tribunal) passed an order against which State Bank of India (SBI) filed an appeal. The order imposed a cost of Rs. 25,000 on the non-applicant/respondent and directed SBI to roll back debit entries adjusted in the account of the Corporate Debtor after June 1, 2017, and restore the account to its state as of that date. The Corporate Debtor had overdrawn Rs. 8,04,81,486.35, exceeding the limit of Rs. 8 crore. A moratorium was passed on June 1, 2017. The Resolution Professional's counsel submitted that approximately Rs. 2 crore had been deposited by the Sales Tax Department towards a refund after the moratorium. SBI's counsel argued that any amount deposited by any person, including the Sales Tax

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## Issues and analysis

### Issue 1: Whether the appellant bank can debit any amount from the Corporate Debtor's account after the order …

**Ratio:** Section 14 of the Insolvency and Bankruptcy Code (IBC) imposes a moratorium, prohibiting

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**Reasoning:** The court reasoned that allowing the bank to debit amounts from the Corporate Debtor's

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**Interpretation:** The interpretation of Section 14 emphasizes the protection afforded to the

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**Application:** The court applied this principle to the specific facts, holding that SBI could

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## Parties

- **Judges:** S.J. Mukhop…; Bansi Lal…
- **Appellants:** State Bank of…
- **Respondents:** MAINI CONSTRUCTION…; Debashish…

## Timeline

- **2018-01-25 — Order by Adjudicating…**: The Adjudicating Authority (National Company Law Tribunal) passed an order against which…
- **2017-06-01 — Moratorium…**: Moratorium was passed on 01.06.2017 by which dated the Corporate Debtor has overdrawn…

## 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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