# In the matter of Indian Treat Ltd. MA 736-2018 In C.P. 4332-I&BP-NCLT-MAH-2018

> NCLT judgment dated 2019-03-11. Citation: TCN-2019-NCLT-04483. Dena Bank initiated Corporate Insolvency Resolution Process (CIRP) against Indian Treat Ltd.…

- **Court:** NCLT
- **Order date:** 11 Mar 2019
- **Citation:** TCN-2019-NCLT-04483
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/indian-treat-ltd-ma-736-2018-in-cp-4332-ibp-nclt-mah-2018-9bd3d72d

## Summary

### Background

Dena Bank initiated Corporate Insolvency Resolution Process (CIRP) against Indian Treat Ltd. Company Petition No. 4332 of 2018 was admitted under Section 7 of the Insolvency and Bankruptcy Code (IBC). Dena Bank, the financial creditor, filed an application for withdrawal of the petition under Section 12A of the IBC. The Zonal Officer of Dena Bank granted approval for withdrawal because the securities charged to the financial creditor had been sold under the SARFAESI Act, 2002, before the admission of the Section 7 petition. The bank recovered Rs. 9,35,89,650, which is 30.56% of the outstanding dues. The applicant submits that the plant and machinery, the only security left, may not be worth more than Rs. 35 lakhs. The applicant cannot write off the balance outstanding

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## Facts

Dena Bank initiated CIRP against Indian Treat Ltd. under Section 7 of IBC. Company Petition No. 4332 of 2018 was admitted. Dena Bank sought to withdraw the petition under Section 12A of IBC, having received approval from its Zonal Officer. The securities charged to Dena Bank were sold under the SARFAESI Act before the admission of the Section 7 petition, recovering Rs. 9,35,89,650 (30.56% of outstanding dues). The remaining security, plant and machinery, is valued at less than Rs. 35 lakhs. The applicant cannot write off the balance outstanding or arrive at settlement without proceedings against the personal guarantors. The Committee of Creditors was not constituted.

## Issues and analysis

### Issue 1: Whether the application for withdrawal of Company …

**Ratio:** Section 12A of the I&B Code allows the Adjudicating Authority to permit withdrawal of

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**Reasoning:** The court considered the contents of the application and the submissions made by the

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**Interpretation:** Section 12A provides a mechanism for withdrawal of CIRP applications, subject

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**Application:** The court applied Section 12A and the principles established in 'Swiss Ribbons'

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## Parties

- **Judges:** Bhaskara Pantula…; V. Nallasen…
- **Appellants:** Dena…
- **Respondents:** Indian Trea…

## Timeline

- **2018-01-01 — Company Petiti…**: Company Petition No. 4332 of 2018…
- **2019-01-30 — CIRP Ord…**: Corporate Debtor was put on CIRP by an order of this Bench dated 30.01.2019 on a section…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 12A — (1) Subject to sub](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-12a)

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