# In the matter of State Bank of India vs. Dharamraj Aluminium Industries Private Limited

> NCLAT judgment dated 2023-11-10. Citation: TCN-2023-NCLAT-00078. The case involves an appeal against an order dated 29.11.2022 passed by the National Company…

- **Court:** NCLAT
- **Order date:** 10 Nov 2023
- **Citation:** TCN-2023-NCLAT-00078
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/state-bank-of-india-vs-dharamraj-aluminium-industries-private-limited-6ad26c6c

## Summary

### Background

The case involves an appeal against an order dated 29.11.2022 passed by the National Company Law Tribunal (NCLT), Mumbai Bench, Court-IV, which dismissed an application filed by State Bank of India (SBI) under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC). SBI had sanctioned credit facilities to Dharamraj Aluminium Industries Private Limited, the Corporate Debtor. The account was classified as NPA on 29.04.2016. SBI filed a petition under Section 7 of IBC on 13.01.2022, claiming default. The NCLT dismissed the application, holding it was barred by limitation. SBI appealed this decision.

## Facts

State Bank of India (SBI) sanctioned credit facilities to Dharamraj Aluminium Industries Private Limited. The Corporate Debtor defaulted on 30.01.2016. SBI classified the account as Non-Performing Asset (NPA) on 29.04.2016. SBI filed O.A. No.762 of 2017 seeking a recovery certificate. A winding-up petition was filed against the Corporate Debtor by M/s Oswal Minerals Limited, and the Bombay High Court ordered the company to be wound up on 25.01.2018. SBI filed a petition under Section 7 of the Insolvency and Bankruptcy Code (IBC) on 13.01.2022, claiming Rs.22,52,02,115.61/-. The NCLT dismissed the Section 7 petition as barred by limitation. The Corporate Debtor made a request for One Time Settlement (OTS) on 08.07.2021. The OTS offer was rejected by SBI on 15.07.2021.

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## Issues and analysis

### Issue 1: Whether the application under Section 7 of the Insolvency and Bankruptcy Code, 2016 filed by the …

**Ratio:** Section 14(2) of the Limitation Act allows for exclusion of time during which the

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**Reasoning:** The Adjudicating Authority held that the Section 7 petition was filed after three years

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**Interpretation:** The interpretation of Section 14(2) of the Limitation Act requires that the

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**Application:** In this case, the winding-up petition was filed by M/s Oswal Minerals Limited,

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## Parties

- **Judges:** Ashok Bh…; Barun M…
- **Appellants:** State Bank of…
- **Respondents:** Dharamraj…

## Timeline

- **2013-02-01 — Sanction of Credit…**: State Bank of India sanctioned Cash Credit Facility of Rs.7 crores and Forward Contract…
- **2016-01-30 — Default by Corporate…**: Default took place on the part of the Corporate Debtor – Dharamraj Aluminium Industries…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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