# In the matter of Rolta India Limited CP(IB)3561(MB)-2018

> NCLT judgment dated 2019-05-01. Citation: TCN-2019-NCLT-03581. Union Bank of India filed a petition under Section 7 of the Insolvency and Bankruptcy Code…

- **Court:** NCLT
- **Order date:** 1 May 2019
- **Citation:** TCN-2019-NCLT-03581
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/rolta-india-limited-cpib3561mb-2018-a160d4fc

## Summary

### Background

Union Bank of India filed a petition under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016, seeking to initiate the Corporate Insolvency Resolution Process (CIRP) against Rolta India Limited for the realization of Rs. 1233,54,79,298/- due as on 7.9.2018. The petition was based on a Reserve Bank of India (RBI) circular dated 12.2.2018. Rolta India Limited challenged the RBI circular in the Supreme Court via Writ Petition No. 237/2019. A consortium meeting was held on 5.2.2019, where lenders discussed the status of the NCLT application and other critical issues. The company had requested a No Objection Certificate (NOC) for disinvestment, but lenders had not issued it due to unresolved critical issues. Tech Mahindra withdrew its offer for disinvestment. Union

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## Facts

Union Bank of India initiated CIRP against Rolta India Limited under Section 7 of IBC, seeking to recover Rs. 1233,54,79,298/- due as of 7.9.2018. The CIRP application was based on the RBI circular dated 12.2.2018. Rolta India Limited challenged the RBI circular in the Supreme Court via Writ Petition No. 237/2019. A consortium meeting of lenders on 5.2.2019 discussed the NCLT application status. Lenders expressed concern over the company's non-participation. The company's request for NOC for disinvestment was not addressed due to unresolved issues. Tech Mahindra withdrew its disinvestment offer. Union Bank of India, Bank of India, and Central Bank of India issued recall notices. Central Bank of India filed a DRT suit. Band Holders and Akbar Travels filed applications

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## Issues and analysis

### Issue 1: Whether the petition filed by Union Bank of India under Section 7 of the IBC, 2016, based on the …

**Ratio:** The legal principle applied is that if the basis of a legal proceeding is struck down by

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**Reasoning:** The court reasoned that the Supreme Court had struck down the RBI Circular, which was the

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**Interpretation:** The interpretation is that a legal action cannot stand if its foundation (in

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**Application:** Since the petition was based on the RBI Circular, and the Supreme Court had

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## Parties

- **Judges:** V. P. S…; RavikumarDu…
- **Appellants:** Union Bank of…
- **Respondents:** Rolta India…

## Timeline

- **2016-01-01 — Enactment…**: The Insolvency and…
- **2018-02-12 — RBI Circula…**: Date of the Reserve Bank of India (RBI)…

## 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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