# In the matter of Shakambari Rubber Private Limited CP (IB) No. 621-KB-2019

> NCLT judgment dated 2020-01-14. Citation: TCN-2020-NCLT-02338. Corporation Bank, the Financial Creditor, filed an application under Section 7 of the…

- **Court:** NCLT
- **Order date:** 14 Jan 2020
- **Citation:** TCN-2020-NCLT-02338
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/shakambari-rubber-private-limited-cp-ib-no-621-kb-2019-9d180b1c

## Summary

### Background

Corporation Bank, the Financial Creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Shakambari Rubber Private Ltd., the Corporate Debtor, for initiating the Corporate Insolvency Resolution Process (CIRP). The application was based on the Corporate Debtor's default in paying a financial debt of Rs. 7,14,19,605/-. The bank had initially guaranteed and disbursed term loan and CC facilities to the extent of Rs. 4.60 crores on 06.06.2013, which was later extended and enhanced on 27.09.2014. The Corporate Debtor defaulted in paying the loan, leading to its loan account being declared NPA on 30.01.2016. A notice under Section 13(2) of the SARFAESI Act, 2002, was issued on 26.06.2016. The application was duly served on the

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## Facts

Corporation Bank, the Financial Creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Shakambari Rubber Private Ltd., the Corporate Debtor. The application was based on the Corporate Debtor's default in paying a financial debt of Rs. 7,14,19,605/-. Initially, on 06.06.2013, the bank had guaranteed and disbursed term loan and CC facilities to the extent of Rs. 4.60 crores to the Corporate Debtor. The term of the loan and CC was extended and enhanced on 27.09.2014. The Corporate Debtor defaulted in paying the loan in time, and its loan account was declared NPA on 30.01.2016. On 26.06.2016, the bank issued a notice under Section 13(2) of the SARFAESI Act, 2002, calling upon the Corporate Debtor to clear the outstanding debt.

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## Issues and analysis

### Issue 1: Whether the Financial Creditor established that a debt of more than Rs. 1 lakh is due and payable …

**Ratio:** The legal principle is that under Section 7 of the IBC, the adjudicating authority must

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**Reasoning:** The court perused the evidence produced by the Financial Creditor and found that the

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**Interpretation:** This issue involves interpreting Section 7 of the IBC to determine the

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**Application:** The court applied this principle to the facts by examining the evidence

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## Parties

- **Judges:** Madan B.…; Harish Chander…
- **Appellants:** Corporatio…
- **Respondents:** M/s. Shakambari…

## Timeline

- **2013-06-06 — Initial Loan Disbursemen…**: Corporation Bank guaranteed and disbursed term loan and CC facilities to Shakambari…
- **2014-09-27 — Loan Extension and…**: The term of the loan and CC…

## 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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