# In the matter of S R Industries Limited CP (IB) No. 198-Chd-Pb-2021

> NCLT judgment dated 2021-12-21. Citation: TCN-2021-NCLT-00091. UCO Bank, the financial creditor, filed a petition under Section 7 of the Insolvency and…

- **Court:** NCLT
- **Order date:** 21 Dec 2021
- **Citation:** TCN-2021-NCLT-00091
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/s-r-industries-limited-cp-ib-no-198-chd-pb-2021-6cf8a593

## Summary

### Background

UCO Bank, the financial creditor, filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against M/s S.R. Industries Limited, the corporate debtor. The bank had sanctioned credit facilities to the corporate debtor in 2009, which were enhanced over time. The corporate debtor defaulted on payments, leading to the bank classifying the account as NPA on 30.06.2017. The bank also initiated recovery proceedings before the Debt Recovery Tribunal. The corporate debtor acknowledged facing financial difficulties and inability to pay its debts.

## Facts

UCO Bank sanctioned credit facilities to M/s S.R. Industries Limited in 2009, which were subsequently enhanced. The corporate debtor defaulted on payments, leading UCO Bank to classify the account as a Non-Performing Asset (NPA) on June 30, 2017. The amount in default was ₹24,33,50,479.33/- with interest up to March 31, 2021. The corporate debtor's assets are secured by hypothecation of stock and machinery, as well as a mortgage of land. UCO Bank also initiated recovery proceedings before the Debt Recovery Tribunal (DRT). The corporate debtor admitted to facing financial difficulties and being unable to pay its debts. The petition to initiate CIRP was filed on July 26, 2021. The date of default is stated to be 30.06.2017. The credit facilities sanctioned to the

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## Issues and analysis

### Issue 1: Whether the present application …

**Ratio:** As per Article 137 of the Limitation Act, the right to initiate action is three years

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**Reasoning:** The court considered the Supreme Court's orders regarding the extension of the limitation

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**Interpretation:** The Supreme Court's orders regarding the extension of the limitation period due

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**Application:** The court applied the extended limitation period to the facts of the case and

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## Parties

- **Judges:** Harnam Singh…; SUBRATA KUM…
- **Appellants:** UCO B…
- **Respondents:** M/s S.R. Industrie…

## Timeline

- **2009-01-01 — Credit Facilities…**: UCO Bank sanctioned credit…
- **2009-08-05 — Sanction Lett…**: Credit facility sanctioned vide…

## 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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