# In the matter of Skylead Chemicals Ltd. CP (IB) No. 113-7-NCLT-AHM-2019

> NCLT judgment dated 2021-01-12. Citation: TCN-2021-NCLT-03311. The case involves an application filed by M/s. Stressed Assets Stabilization Fund, the…

- **Court:** NCLT
- **Order date:** 12 Jan 2021
- **Citation:** TCN-2021-NCLT-03311
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/skylead-chemicals-ltd-cp-ib-no-113-7-nclt-ahm-2019-6e2f6834

## Summary

### Background

The case involves an application filed by M/s. Stressed Assets Stabilization Fund, the Financial Creditor, under Section 7 of the Insolvency and Bankruptcy Code, 2016, against M/s. Skylead Chemicals Ltd, the Corporate Debtor, to initiate Corporate Insolvency Resolution Process (CIRP). The Financial Creditor alleged that the Corporate Debtor defaulted in paying a financial debt of Rs. 90,60,22,736/-. The application was filed before the Ahmedabad Bench of the National Company Law Tribunal (NCLT).

## Facts

M/s. Stressed Assets Stabilization Fund, the Financial Creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against M/s. Skylead Chemicals Ltd, the Corporate Debtor, seeking to initiate Corporate Insolvency Resolution Process (CIRP). The alleged default amount was Rs. 90,60,22,736/-. The date of default was noted as 19.04.2004, and the application was filed on 25.01.2019, which is approximately fifteen years after the default date. The Financial Creditor produced a letter of acknowledgement, but it was beyond the three-year limitation period. The key fact is the significant delay between the date of default and the filing of the application, which raised the issue of limitation.

## Issues and analysis

### Issue 1: Whether the application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016, is …

**Ratio:** The principle of law is that applications under Section 7 or Section 9 of the Insolvency

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**Reasoning:** The court reasoned that the application was filed approximately fifteen years after the

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**Interpretation:** The interpretation is that the Law of Limitation applies to insolvency

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**Application:** The ratio and reasoning were applied to the facts of the case, where the

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## Parties

- **Judges:** Madan B.…; Virendra Kumar…
- **Appellants:** Stressed Assets…
- **Respondents:** Skylead Chemicals…

## Timeline

- **2004-04-19 — Date of D…**: The Corporate Debtor defaulted…
- **2019-01-25 — Application…**: The Financial Creditor filed an application under Section 7 of the Insolvency and…

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