# In the matter of Supreme Tex Mart Limited

> NCLT judgment dated 2018-08-08. Citation: TCN-2018-NCLT-00972. The case involves corporate insolvency resolution process (CIRP) initiated against Supreme Tex…

- **Court:** NCLT
- **Order date:** 8 Aug 2018
- **Citation:** TCN-2018-NCLT-00972
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/supreme-tex-mart-limited-3c324035

## Summary

### Background

The case involves corporate insolvency resolution process (CIRP) initiated against Supreme Tex Mart Ltd. by Allahabad Bank under Section 7 of the Insolvency and Bankruptcy Code, 2016. The petition was admitted on 29.09.2017, and a moratorium was declared. Mr. Bhupesh Gupta was appointed as the Interim Resolution Professional (IRP). The IRP constituted a Committee of Creditors (CoC) comprising 12 financial creditors. The CoC confirmed the IRP as the Resolution Professional (RP). The RP invited Expression of Interest (EOI) for resolution plans, and several plans were submitted and revised. CA No.265 of 2018 was filed by Supreme Association of Employees of the Corporate Debtor, claiming that liquidation should be avoided. The CoC ultimately decided to liquidate the

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## Facts

Allahabad Bank initiated CIRP against Supreme Tex Mart Ltd. under Section 7 of IBC. The petition was admitted on 2017-09-29, and a moratorium was declared. Bhupesh Gupta was appointed as IRP and later confirmed as RP. The CoC comprised 12 financial creditors. The CoC invited EOIs for resolution plans, and four entities submitted them. The CoC re-invited EOIs and extended the submission deadline. Two plans were received, one of which was rejected. The CoC decided to get a fresh valuation due to variations in earlier valuations. The CoC rejected the resolution plan offered by the sole resolution applicant on 2018-05-25. The joint applicants presented a resolution plan of ₹231.16 Crores on 2018-06-13, which was also rejected by the CoC. The upfront cash payment of ₹70

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## Issues and analysis

### Issue 1: Whether the Corporate Debtor should be liquidated given the expiry of the 270-day CIRP period …

**Ratio:** Section 33 of the Insolvency and Bankruptcy Code mandates liquidation if no resolution

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**Reasoning:** The court reasoned that the 270-day CIRP period had expired on 2018-06-26, and no

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**Interpretation:** Section 33 is interpreted strictly to mean that if the CIRP fails to produce a

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**Application:** Since the CIRP period expired without an approved plan, the court applied

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## Parties

- **Judges:** R.P.Nag…; Pradeep R.…
- **Appellants:** Allahabad…
- **Respondents:** Supreme Tex Mart…

## Timeline

- **2017-09-29 — Petition Ad…**: Petition filed by Allahabad Bank…
- **2017-10-11 — Appointment…**: Mr. Bhupesh Gupta appointed as…

## 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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