# In the matter of Union Bank of India (erstwhile Andhra Bank) Vs. Siripuram Developers Pvt. Ltd. and Ors. CA (AT) (Ins) No. 890 of 2020

> NCLAT judgment dated 2021-02-25. Citation: TCN-2021-NCLAT-00351. The appeal was filed by Union Bank of India (erstwhile Andhra Bank, now merged) under Section…

- **Court:** NCLAT
- **Order date:** 25 Feb 2021
- **Citation:** TCN-2021-NCLAT-00351
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/union-bank-of-india-erstwhile-andhra-bank-vs-siripuram-developers-pvt-ltd-and-or-67040f1f

## Summary

### Background

The appeal was filed by Union Bank of India (erstwhile Andhra Bank, now merged) under Section 61 of the Insolvency and Bankruptcy Code, 2016, against the order dated 20.08.2020 passed by the Adjudicating Authority (National Company Law Tribunal, Hyderabad Bench) in I.A No. 335 of 2020 in CP(IB) No.297/7/HDB/2017. The Adjudicating Authority disposed of the Interlocutory Application and directed Respondent No.1 bank not to take any coercive steps such as sale of the properties mortgaged by the Appellant companies in favor of Respondent No.1 bank till the completion of Liquidation proceedings of the Corporate Debtor.

## Facts

Union Bank of India (erstwhile Andhra Bank) filed an appeal against the order of the Adjudicating Authority (NCLT, Hyderabad) dated 20.08.2020. The Adjudicating Authority had directed the bank not to take coercive steps to sell properties mortgaged by the respondent companies until the liquidation proceedings of the corporate debtor were completed. The respondents had provided corporate guarantees and mortgaged properties as collateral for the corporate debtor's financial debt. The appellant bank initiated SARFAESI proceedings and issued demand and possession notices. The respondents objected, arguing that Section 238 of the IBC supersedes SARFAESI. The Adjudicating Authority considered selling the corporate debtor as a going concern. The key fact is that the

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority's order directing the Appellant Bank not to take coercive steps …

**Ratio:** The ratio is based on the interpretation of Section 36(4)(d) of the Insolvency and

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**Reasoning:** The court reasoned that since the mortgaged properties belong to the subsidiaries of the

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**Interpretation:** Section 36(4)(d) is interpreted to mean that assets owned by subsidiaries of

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**Application:** The ratio and reasoning are applied to the specific facts of the case, where

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## Parties

- **Judges:** Bansi Lal…; Ashok Kumar…
- **Appellants:** Union Bank of…
- **Respondents:** IVRCL Li…; Siripuram…

## Timeline

- **2017-01-01 — Initiation…**: State Bank of India initiated…
- **2018-02-23 — Admission of Ap…**: Adjudicating Authority…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 61 — Appeals and Appellate Authority](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-61)

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