# In the matter of Atlasgold Townships (India) Pvt. Ltd. TIBA-19-KOB-2019

> NCLT judgment dated 2019-12-19. Citation: TCN-2019-NCLT-00084. The South Indian Bank Limited filed an application under Section 7 of the Insolvency and…

- **Court:** NCLT
- **Order date:** 19 Dec 2019
- **Citation:** TCN-2019-NCLT-00084
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/atlasgold-townships-india-pvt-ltd-tiba-19-kob-2019-9893c810

## Summary

### Background

The South Indian Bank Limited filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, against M/s. Atlas Gold Township Pvt. Ltd, treating it as a 'Corporate Guarantor/ Corporate Debtor' with a request to initiate Corporate Insolvency Resolution Process. The South Indian Bank (India) Limited is a Banking Company registered under Companies Act, having its Registered Office at SIB House, Mission Quarters T B Road, Thrissur. The Corporate Debtor Company is a private limited company which is a part of Atlas Group of companies, registered under the Companies Act having its Registered Office in XI/305 H, Opp. CIAL, Vappalassery, Nedumbassery,

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## Facts

The South Indian Bank Limited, a financial creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against M/s. Atlas Gold Township Pvt. Ltd, the corporate debtor, treating it as a corporate guarantor. Atlas Jewellery Pvt. Ltd. (Principal Borrower) had borrowed funds from the bank, and the corporate debtor stood as a guarantor, owing Rs. 241,24,15,790.97 as of 31.12.2015. The bank initiated recovery proceedings under SARFAESI Act, 2002, and before the Debt Recovery Tribunal, Ernakulam, with ₹ 259.64 Crores due as of 23.10.2019. The corporate debtor opposed the application, claiming the documents were contrary to law, barred by limitation, and not maintainable. The corporate debtor argued that the bank had obtained signatures on

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## Issues and analysis

### Issue 1: Whether the application filed by the …

**Ratio:** The application under Section 7 of the I&B Code is subject to the limitation period

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**Reasoning:** The court considered the guarantee agreement and whether the principal borrower

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**Interpretation:** The court interpreted the guarantee agreement and the admission of debt by the

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**Application:** The court applied the ratio to the facts of the case, noting that the principal

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## Parties

- **Judges:** Ashok Kumar…; Veera Brahma Rao…
- **Appellants:** The South Indian…
- **Respondents:** M/s Atlas Gold…

## Timeline

- **2013-03-21 — Loan San…**: Loan amount sanctioned by the applicant bank to the principal borrower was to the tune of…
- **2013-10-21 — Loan San…**: Loan amount sanctioned by the applicant bank to the principal borrower was to the tune of…

## 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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