# In the matter of Andhra Bank Vs Sterling Biotech Limited CP (IB) 490 (MB) -2018

> NCLT judgment dated 2019-03-11. Citation: TCN-2019-NCLT-04486. Andhra Bank initiated Corporate Insolvency Resolution Process (CIRP) against Sterling Biotech…

- **Court:** NCLT
- **Order date:** 11 Mar 2019
- **Citation:** TCN-2019-NCLT-04486
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/andhra-bank-vs-sterling-biotech-limited-cp-104b89a1

## Summary

### Background

Andhra Bank initiated Corporate Insolvency Resolution Process (CIRP) against Sterling Biotech Limited under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016. The CIRP was admitted on 2018-06-11. Subsequently, Andhra Bank filed MA 951/2019 seeking to withdraw the CIRP under Section 12A of the IBC, based on an OTS (One-Time Settlement) offer from the promoters of Sterling Biotech. The Committee of Creditors (CoC) considered the withdrawal, but the initial resolution for withdrawal did not receive the requisite 90% voting share. Andhra Bank then submitted a fresh Form FA for withdrawal, supported by a majority of the CoC members. The Resolution Professional (RP) sought details of the OTS offer, but Andhra Bank stated they would address the Tribunal directly.

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## Facts

Andhra Bank initiated CIRP against Sterling Biotech Limited under Section 7 of IBC. The CIRP was admitted on 2018-06-11. Andhra Bank filed MA 951/2019 to withdraw CIRP under Section 12A, based on an OTS offer from Sterling Biotech's promoters. The initial CoC vote for withdrawal failed to reach the 90% threshold. Andhra Bank submitted a fresh Form FA for withdrawal. The RP requested details of the OTS offer, but Andhra Bank stated they would address the Tribunal directly. The CoC received a revised OTS offer from the Corporate Debtor's promoter on 2018-08-08. The CoC accepted the withdrawal of CIRP with 90.32% vote in the 14th meeting. The Resolution Professional put a fresh resolution for withdrawal of CIRP under section 12A to vote on 2019-03-05, which received

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## Issues and analysis

### Issue 1: Whether the application for withdrawal of CIRP under Section 12A of the IBC, filed by Andhra Bank, …

**Ratio:** Section 12A of the IBC allows the Adjudicating Authority to permit the withdrawal of an

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**Reasoning:** The Tribunal noted that while the CoC had approved the withdrawal with the requisite

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**Interpretation:** Section 12A provides a mechanism for withdrawing CIRP applications, but the

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**Application:** In this case, the Tribunal deferred the decision on the withdrawal application

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## Parties

- **Judges:** V. P. S…; RavikumarDu…
- **Appellants:** M/s. Andhr…
- **Respondents:** Sterling Biotech…; M/s Sterling…

## Timeline

- **2018-06-11 — CIRP Admi…**: Corporate Insolvency Resolution Process (CIRP) was admitted against Sterling Biotech…
- **2018-08-08 — Revised OTS…**: The CoC received a revised offer from the promoter of the Corporate Debtor for a one-time…

## 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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