# In the matter of Sunder Nagar Co-Operative Housing Societies Union Limited vs. State Bank of India & Ors. Company Appeal (AT) (Insolvency) No. 1526 & 1527 of 2022

> NCLAT judgment dated 2023-05-31. Citation: TCN-2023-NCLAT-00475. The case involves two appeals (CA (AT) (Ins) No. 1527 of 2022 and CA (AT) (Ins) No. 1526 of…

- **Court:** NCLAT
- **Order date:** 31 May 2023
- **Citation:** TCN-2023-NCLAT-00475
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/sunder-nagar-co-operative-housing-societies-union-limited-vs-state-bank-of-india-474c45b7

## Summary

### Background

The case involves two appeals (CA (AT) (Ins) No. 1527 of 2022 and CA (AT) (Ins) No. 1526 of 2022) filed against the same impugned order dated 06.12.2022. The appeals arise from an application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016 by State Bank of India (Financial Creditor) against A A Estates Private Limited (Corporate Debtor) for the resolution of an unresolved financial debt of Rs. 1,35,26,12,129/-. The first appeal was filed by a shareholder/director of the Corporate Debtor, while the second appeal was filed by a federal society comprising nine societies incorporated under the Maharashtra Co-operative Societies Act, 1960. The Corporate Debtor is engaged in real estate construction and development. The Financial Creditor had granted cash

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## Facts

The Corporate Debtor, A A Estates Private Limited, defaulted on a financial debt of Rs. 1,35,26,12,129/- owed to the State Bank of India (Financial Creditor). The debt arose from cash credit facilities granted by the Financial Creditor, secured by various means including charges on flats, escrow agreements, hypothecation agreements, and mortgages. The Corporate Debtor failed to maintain its account and defaulted on 31.03.2014. The Financial Creditor requested the Corporate Debtor to regularize its account. The Corporate Debtor addressed a revival letter dated 18.03.2014 and acknowledged the outstanding debt. The Financial Creditor vide letter of arrangement dated 18.03.2014 informed the Corporate Debtor that it had sanctioned shifting the Date of Commencement of

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## Issues and analysis

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

**Ratio:** Section 18 of the Limitation Act states that if, before the expiration of the prescribed

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**Reasoning:** The NCLAT reasoned that the Corporate Debtor acknowledged its debt by submitting a

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**Interpretation:** The interpretation of Section 18 of the Limitation Act in the context of IBC

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**Application:** In this case, the Corporate Debtor's compromise letter dated 31.01.2018

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## Parties

- **Judges:** Rakesh Kuma…; Naresh Sa…
- **Appellants:** Sunder Nagar…
- **Respondents:** A A Estates…; State Bank of…
- **Advocates:** Mrinal Elker…; Saurabh…; +10 more

## Timeline

- **1960-01-01 — Incorpor…**: Nine societies incorporated under the provisions of Maharashtra Co-operative Societies…
- **1996-07-17 — Incorporation of…**: A A Estates Private Limited…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 19 — Personnel to extend co-operation to interim…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-19)

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