# In the matter of Orissa Manganese & Minerals Ltd. CP (IB) No. 371-KB-2017

> NCLT judgment dated 2017-08-03. Citation: TCN-2017-NCLT-00666. State Bank of India (SBI) filed an application under Section 7 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 3 Aug 2017
- **Citation:** TCN-2017-NCLT-00666
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/orissa-manganese-minerals-ltd-cp-ib-no-371-kb-2017-89c02a61

## Summary

### Background

State Bank of India (SBI) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) against Orissa Manganese & Minerals Ltd., a corporate debtor. SBI, through a Gazette notification dated 22/2/2017, acquired the business, including assets and liabilities, of State Bank of Bikaner and Jaipur, State Bank of Mysore, State Bank of Patiala, and State Bank of Travancore. SBI claimed default by Orissa Manganese & Minerals Ltd. The corporate debtor objected, citing a pending merger application before the Orissa High Court and ongoing restructuring discussions.

## Facts

State Bank of India (SBI) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) against Orissa Manganese & Minerals Ltd. (OMML), claiming default on loan repayments. SBI had acquired the assets and liabilities of several associate banks through a Gazette notification dated 22/2/2017. SBI had granted various loans to OMML, and OMML had also taken obligations as a Co-Obligor/Co-Borrower for loans disbursed to AML. AML defaulted on these loans, triggering SBI's right to proceed against OMML. The outstanding amount on the account as of 31/5/2017 was Rs. 9,404,806,298.63. OMML objected, citing a pending merger application before the Orissa High Court, ongoing restructuring discussions with the Joint Lenders Forum (JLF), and the adequacy

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## Issues and analysis

### Issue 1: Whether the petition filed by State Bank of India under Section 7 of the Insolvency and Bankruptcy …

**Ratio:** The pendency of a merger application before the High Court does not bar the initiation of

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**Reasoning:** The NCLT relied on the NCLAT's decision, which stated that the financial creditor has a

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**Interpretation:** The IBC provides a distinct and independent mechanism for resolving insolvency,

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**Application:** The NCLT held that the pending merger application before the Orissa High Court

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## Parties

- **Judges:** Vijai Prata…
- **Respondents:** Orissa Manganese…
- **Advocates:** Siddhartha…; Suhani Dw…; +6 more

## Timeline

- **2017-02-22 — Gazette Notif…**: State Bank of India acquired the…
- **2017-03-31 — Balance Confirmation…**: Balance confirmation letter issued in…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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