# In the matter of Shreem Corporation Limited I.A. 2580-2021 in C.P. (IB) - 1382-MB-2020

> NCLT judgment dated 2021-09-22. Citation: TCN-2021-NCLT-01037. State Bank of India initiated Corporate Insolvency Resolution Process (CIRP) against Shreem…

- **Court:** NCLT
- **Order date:** 22 Sept 2021
- **Citation:** TCN-2021-NCLT-01037
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/shreem-corporation-limited-ia-2580-2021-in-cp-ib-1382-mb-2020-704553bb

## Summary

### Background

State Bank of India initiated Corporate Insolvency Resolution Process (CIRP) against Shreem Corporation Limited under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC). The application was filed due to a default of Rs. 681.87 crores, including applicable interest. The Corporate Debtor had approached the Petitioner for credit facilities/term loans, which were sanctioned via Letters of Arrangement in 2010 and 2011. The Corporate Debtor defaulted on repayments, leading to the loan account being classified as a Non-Performing Asset (NPA) on 28.06.2013. The Petitioner issued a demand notice under Section 13 of the SARFAESI Act, 2002, and filed an Original Application before the Debts Recovery Tribunal-III, Mumbai, for recovery of dues. The loan account was

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## Facts

State Bank of India (SBI) sanctioned term loans to Shreem Corporation Limited. Shreem Corporation defaulted on repayments, leading SBI to classify the account as NPA on June 28, 2013. SBI issued a demand notice on July 2, 2013, and a legal notice on May 2, 2014. SBI filed Original Application No. 726/2014 before the Debts Recovery Tribunal-III, Mumbai, on June 3, 2014. The Mumbai Debt Recovery Tribunal-III granted interim relief on January 8, 2015, restraining Shreem Corporation from creating third-party rights on secured assets. The loan account was declared a fraud, and a FIR was lodged with the CBI on September 30, 2016. SBI filed a Securitisation Application bearing No. 416 of 2014 before the District Magistrate, Palghar, which was allowed on March 9, 2017. Shreem

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## Issues and analysis

### Issue 1: Whether the application under section 5 of the Limitation Act, seeking condonation of Delay is …

**Ratio:** The Limitation Act, 1963, is applicable to proceedings under the IBC, as per Section 238A

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**Reasoning:** The Bench noted that Section 238A of the Code, inserted in 2018, provides for the

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**Interpretation:** Section 238A of the IBC explicitly incorporates the Limitation Act, 1963, into

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**Application:** The Adjudicating Authority considered the provisions of the Limitation Act,

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## Parties

- **Judges:** SUCHITRA KANUPARTH…; Chandra Bha…; +1 more
- **Appellants:** State Bank of…
- **Respondents:** Shreem Corporation…

## Timeline

- **2010-08-27 — Letter of Arr…**: Petitioner sanctioned term loans vide Letter of Arrangements dated 27.08.2010, 26.11.2010…
- **2010-11-26 — Letter of Arr…**: Petitioner sanctioned term loans vide Letter of Arrangements dated 27.08.2010, 26.11.2010…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 5 — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-5)

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