# In the matter of Super Shiv Shakti Chemicals Private Limited CP No.(IB)-59-7-JPR-2019

> NCLT judgment dated 2020-01-10. Citation: TCN-2020-NCLT-02373. Oriental Bank of Commerce filed an application under Section 7 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 10 Jan 2020
- **Citation:** TCN-2020-NCLT-02373
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/super-shiv-shakti-chemicals-private-limited-cp-noib-59-7-jpr-2019-16e5fe09

## Summary

### Background

Oriental Bank of Commerce filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Super Shiv Shakti Chemicals Private Limited, claiming to be a Financial Creditor. The application seeks initiation of the Corporate Insolvency Resolution Process (CIRP) due to default in repayment of loan amount. The applicant claims that the corporate debtor availed various credit facilities, including cash credit and term loans. The loan accounts of the corporate debtor were classified as NPA on 30.03.2017. The applicant issued a notice under Section 13(2) of the SARFAESI Act, 2002, demanding outstanding amounts, which remained unpaid. The corporate debtor admitted its inability to pay the debt amount and sought time to revive operations through a

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## Facts

Oriental Bank of Commerce (the Applicant) filed an application under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016, against Super Shiv Shakti Chemicals Private Limited (the Respondent/Corporate Debtor) seeking initiation of Corporate Insolvency Resolution Process (CIRP). The Applicant claimed to be a Financial Creditor. The Corporate Debtor had availed various credit facilities, including Cash Credit Facility of Rs. 5,00,00,000/- vide sanction letter dated 09.01.2013, Term Loan I of Rs. 3,64,00,000/- sanctioned vide letter dated 17.10.2013, and Term Loan II of Rs. 10,00,00,000/- sanctioned vide letter dated 17.02.2015. The loan accounts were classified as NPA on 30.03.2017 due to the Corporate Debtor's failure to maintain financial discipline. The

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## Issues and analysis

### Issue 1: Whether the application filed by the Applicant is maintainable under Section 7 of the Insolvency …

**Ratio:** Section 7 of the IBC, 2016 allows a financial creditor to initiate CIRP against a

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**Reasoning:** The court considered the documents submitted by the applicant, including loan agreements,

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**Interpretation:** Section 7 provides the mechanism for financial creditors to trigger the

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**Application:** The court found that the applicant had provided sufficient evidence to

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## Parties

- **Judges:** P.S.N. P…; RaghuNa…
- **Appellants:** Oriental Bank of…
- **Respondents:** Super Shiv Shakti…

## Timeline

- **2013-01-09 — Cash Credit Facility…**: Cash Credit Facility of Rs. 5,00,00,000/-…
- **2013-10-17 — Term Loan I Sa…**: Term Loan I of Rs. 3,64,00,000/-…

## 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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