# In the matter of Advance Sufactants India Limited Company Petitiion No. (IB)-922 (PB)-2018

> NCLT judgment dated 2019-05-28. Citation: TCN-2019-NCLT-03165. State Bank of India filed an application under Section 7 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 28 May 2019
- **Citation:** TCN-2019-NCLT-03165
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/advance-sufactants-india-limited-company-petitiion-no-ib-922-pb-2018-74dfc7a6

## Summary

### Background

State Bank of India filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Advance Surfactants India Limited, referred to as the corporate debtor. The application was filed due to the corporate debtor's failure to repay outstanding dues. The applicant bank, along with other banks, had sanctioned various credit facilities to the corporate debtor, which were later restructured. The corporate debtor availed these facilities but defaulted on repayments, leading to the account being categorized as NPA. The bank issued a legal demand notice, but the default persisted.

## Facts

State Bank of India (SBI) filed a petition under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against M/s Advance Surfactants India Limited, the Corporate Debtor. SBI claimed a total outstanding debt of Rs. 157,25,13,562.32 as of 22.07.2018, including principal and interest, stemming from various credit facilities sanctioned to the Corporate Debtor over time. These facilities included Cash Credit, Term Loans, and BG-RA. The Corporate Debtor had been granted and restructured credit/loan facilities on multiple occasions, including 31.03.2005, 01.05.2007, 28.09.2017, 30.11.2007, 31.12.2007, 13.07.2009, 04.01.2019 and 03.11.2011. SBI, along with Yes Bank and IDBI Bank, formed a consortium that

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## Issues and analysis

### Issue 1: Whether the pendency of recovery proceedings before the Debt Recovery Tribunal (DRT) bars the …

**Ratio:** The Insolvency and Bankruptcy Code, 2016, being a complete Code and Union Law, prevails

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**Reasoning:** The Tribunal relied on Section 238 of the IBC, which gives overriding effect to the Code

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**Interpretation:** Section 238 of the IBC is interpreted to mean that the IBC has primacy over

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**Application:** The pendency of recovery proceedings before the DRT does not prevent the

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## Parties

- **Judges:** M. M. K…; S. K. MOH…
- **Appellants:** State Bank of…
- **Respondents:** Advance Surfactant…; M/s Advance…

## Timeline

- **2015-12-28 — Account Categorized as…**: The account of Advance Surfactants India Limited was categorized as Non-Performing Asset…
- **2017-02-01 — Legal Demand…**: State Bank of India issued a legal demand…

## 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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