# In the matter of Shri Maruthi Textiles Limited CP (IB) No. 225-7-HDB-2018

> NCLT judgment dated 2019-02-07. Citation: TCN-2019-NCLT-04959. The case involves a petition filed by International Asset Reconstruction Company Private…

- **Court:** NCLT
- **Order date:** 7 Feb 2019
- **Citation:** TCN-2019-NCLT-04959
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/shri-maruthi-textiles-limited-cp-ib-no-225-7-hdb-2018-6d434f5b

## Summary

### Background

The case involves a petition filed by International Asset Reconstruction Company Private Limited (Financial Creditor) against Shri Maruthi Textiles Limited (Corporate Debtor) under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016. The Financial Creditor claims that the Corporate Debtor defaulted in repaying a sum of Rs. 26,60,58,116/- as on 13.12.2000, along with interest. The Corporate Debtor had initially availed credit facilities from Industrial Credit and Investment Corporation of India Ltd (ICICI) which were later assigned to Standard Chartered Bank and subsequently to the Financial Creditor. The Corporate Debtor's assets were subject to attachment orders from Debt Recovery Tribunal (DRT) and Employees Provident Fund Organization (EPFO).

## Facts

Shri Maruthi Textiles Limited (Corporate Debtor) availed credit facilities from Industrial Credit and Investment Corporation of India Ltd (ICICI), later changed to ICICI Ltd, under agreements dated 05.10.1990, 06.03.1991, 28.03.1991 and 30.03.1992, amounting to Rs. 110 Lakhs, Rs. 105 Lakhs, 712,000 DM and Rs. 280 Lakhs respectively. These loans, along with underlying security interests, were assigned by ICICI Ltd to Standard Chartered Bank on 18.02.2006, and subsequently to International Asset Reconstruction Company Private Limited (Financial Creditor) via registered Assignment Agreements dated 31.07.2012. The Corporate Debtor defaulted on repayments, leading ICICI Ltd to classify the account as NPA on 07.08.2000 and file OA No.1297/2000 before DRT Chennai. The DRT

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## Issues and analysis

### Issue 1: Whether the petition filed by the …

**Ratio:** The time spent in pursuing legal remedies before other forums, such as the Debt Recovery

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**Reasoning:** The court reasoned that the Financial Creditor had been diligently pursuing recovery of

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**Interpretation:** This interpretation allows creditors who have been actively pursuing legal

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**Application:** The court applied this principle to the present case, noting that the Financial

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## Parties

- **Judges:** Ratakonda…
- **Appellants:** International…
- **Respondents:** Maruthi Textiles…
- **Advocates:** VVSN…; Mr.V.V.S.…; +4 more

## Timeline

- **1990-10-05 — Loan Agre…**: Corporate Debtor availed Rupee Term Loan and Foreign Currency Loan from Industrial Credit…
- **1991-03-06 — Loan Agre…**: Corporate Debtor availed Rupee Term Loan and Foreign Currency Loan from Industrial Credit…

## 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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