# In the matter of Adhunik Metaliks Ltd. CP No. (IB) No. 373-KB-2017

> NCLT judgment dated 2017-08-03. Citation: TCN-2017-NCLT-00665. State Bank of India filed an application under Section 7 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 3 Aug 2017
- **Citation:** TCN-2017-NCLT-00665
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/adhunik-metaliks-ltd-cp-no-ib-no-373-kb-2017-4849ea22

## Summary

### Background

State Bank of India filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) against Adhunik Metaliks Ltd., a corporate debtor. SBI, through a Gazette notification dated 22/2/2017, acquired the business, including assets and liabilities, of several other banks. SBI claimed that it had granted various loans to Adhunik Metaliks Ltd. pursuant to a Master Restructuring Agreement dated 30/3/2015, a Supplemental Master Restructuring Agreement dated 26/6/2015, and a Common Loan Agreement dated 21/3/2014. Adhunik Metaliks Ltd. allegedly defaulted on these loans, giving SBI the right to proceed against it for repayment.

## Facts

State Bank of India (SBI) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) against Adhunik Metaliks Ltd. (AML). SBI claimed to have granted various loans to AML under a Master Restructuring Agreement dated 30/3/2015, a Supplemental Master Restructuring Agreement dated 26/6/2015, and a Common Loan Agreement dated 21/3/2014. AML allegedly defaulted on these loans. SBI's application was based on a Gazette notification dated 22/2/2017, through which SBI acquired the business, assets, and liabilities of several other banks. The total outstanding exposure with principal, accrued interest, and penal interest was Rs. 8,122,283,769.02 as of 31/5/2017. AML, along with Orissa Manganese & Minerals Ltd. and Zion Steel Ltd., were co-obligors

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## Issues and analysis

### Issue 1: Whether the application filed by State Bank of India under Section 7 of the Insolvency and …

**Ratio:** Section 7 of the Insolvency and Bankruptcy Code, 2016, allows a financial creditor to

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**Reasoning:** The court examined the documents and evidence presented by the financial creditor,

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**Interpretation:** Section 7 provides a mechanism for financial creditors to recover their dues

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**Application:** The court found that State Bank of India had presented sufficient evidence to

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## Parties

- **Judges:** Vijai Prata…
- **Appellants:** State Bank of…
- **Respondents:** Adhunik Metaliks…

## Timeline

- **2017-02-22 — Gazette Notif…**: State Bank of India acquired the business, assets, and liabilities of several other banks…
- **2015-03-30 — Master Restructuring…**: Date of the Master Restructuring Agreement between State Bank of India and Adhunik…

## 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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