# In the matter of Garlico Industries Limited TP 99 of 2019 {CP (IB) No. 641 of 2019}

> NCLT judgment dated 2021-12-03. Citation: TCN-2021-NCLT-00279. The case pertains to an application filed by ICICI Bank Ltd under Section 7 of the Insolvency…

- **Court:** NCLT
- **Order date:** 3 Dec 2021
- **Citation:** TCN-2021-NCLT-00279
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/garlico-industries-limited-tp-99-of-2019-cp-ib-no-641-of-2019-9ef5c861

## Summary

### Background

The case pertains to an application filed by ICICI Bank Ltd under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against M/s. Garlico Industries Ltd. The application was filed due to a default on a financial debt amounting to Rs. 139,811,696/-, including interest as of 15.05.2019. The Corporate Debtor had obtained a loan of Rs. 3 Crores from the Financial Creditor in 1997, and the repayment was scheduled from 15.05.1997 to 15.02.2003. The Corporate Debtor failed to make payments as per the agreed schedule, leading the Financial Creditor to initiate proceedings under the SARFAESI Act, 2002, and file an Original Application before the DRT Jabalpur.

## Facts

ICICI Bank Ltd, the Financial Creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against M/s. Garlico Industries Ltd, the Corporate Debtor. The application was based on a default of Rs. 139,811,696/-, including interest as of 15.05.2019. The Corporate Debtor had obtained a loan of Rs. 3 Crores from the Financial Creditor in 1997, with repayment scheduled from 15.05.1997 to 15.02.2003. The Corporate Debtor failed to adhere to the agreed payment schedule. The Financial Creditor initiated proceedings under the SARFAESI Act, 2002, and filed an Original Application before the DRT Jabalpur. The Corporate Debtor argued that the application was barred by limitation. The

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## Issues and analysis

### Issue 1: Whether the application under Section 7 of the Insolvency and Bankruptcy Code, 2016, is barred by …

**Ratio:** Section 18 of the Limitation Act, 1963, states that if a debtor acknowledges a debt in

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**Reasoning:** The Adjudicating Authority relied on the Supreme Court's judgment in Asset Reconstruction

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**Interpretation:** Section 18 of the Limitation Act, 1963, provides a mechanism for extending the

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**Application:** In this case, the Corporate Debtor acknowledged the debt in its balance sheets.

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## Parties

- **Judges:** Madan B.…; Ajai Das Me…
- **Appellants:** ICICI Ban…
- **Respondents:** Garlico Industries…

## Timeline

- **1997-03-31 — Loan Agre…**: The Corporate Debtor obtained a loan of Rs. 3 Crores from the Financial Creditor and…
- **1997-05-15 — Repayment Sta…**: Scheduled start date for…

## 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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