# In the matter of Swiss Ribbons Private Limited CP(IB) No.1880-NCLT-MB-2018

> NCLT judgment dated 2019-07-16. Citation: TCN-2019-NCLT-02508. The case pertains to a petition filed by Small Industries Development Bank of India (SIDBI)…

- **Court:** NCLT
- **Order date:** 16 Jul 2019
- **Citation:** TCN-2019-NCLT-02508
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/swiss-ribbons-private-limited-cpib-no1880-nclt-mb-2018-a5a2cce4

## Summary

### Background

The case pertains to a petition filed by Small Industries Development Bank of India (SIDBI) under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Swiss Ribbons Private Limited, seeking initiation of Corporate Insolvency Resolution Process (CIRP). SIDBI, as a financial creditor, had granted a term loan of ₹6,30,00,000 to Swiss Ribbons under the Secured Business Loan Scheme. The corporate debtor defaulted on repayment, leading to the account being classified as a Non-Performing Asset (NPA). SIDBI initiated multiple recovery proceedings, including actions under the SARFAESI Act and filing an application with the Debt Recovery Tribunal (DRT).

## Facts

Small Industries Development Bank of India (SIDBI) granted a term loan of ₹6,30,00,000 to Swiss Ribbons Private Limited under the Secured Business Loan Scheme, as per the Letter of Intent dated 04.02.2014. The Corporate Debtor passed a board resolution on 03.03.2014 to avail the financial assistance and entered into a Loan Agreement with SIDBI on 05.03.2014. The Corporate Debtor agreed to repay the loan with interest and other charges as per the Letter of Intent. In pursuance of the financial assistance, the Corporate Debtor executed a deed of guarantee and personal guarantees dated 05.03.2014. The Corporate Debtor defaulted on repayment, leading to the account being classified as a Non-Performing Asset (NPA) on 08.11.2015. SIDBI issued a notice dated 05.02.2016 under

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## Issues and analysis

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

**Ratio:** Section 238 of the Insolvency and Bankruptcy Code, 2016, provides that the provisions of

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**Reasoning:** The court reasoned that Section 238 of the IBC gives the IBC overriding effect over other

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**Interpretation:** Section 238 is interpreted to mean that the IBC takes precedence over other

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**Application:** In this case, the court applied Section 238 to hold that the existence of

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## Parties

- **Judges:** V. P. S…; Ravikumar…; +1 more
- **Appellants:** Small Industries…
- **Respondents:** Swiss Ribbons…

## Timeline

- **2014-02-04 — Letter of…**: SIDBI issued a Letter of Intent sanctioning a loan of ₹6,30,00,000 to Swiss Ribbons…
- **2014-03-03 — Board Reso…**: Swiss Ribbons Private Limited passed a board resolution accepting the terms and…

## 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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