# In the matter of Adya Oils and Chemicals Ltd.

> NCLT judgment dated 2025-01-22. Citation: TCN-2025-NCLT-00597. The case involves an application (I.A. No. 1305 of 2020) filed by Rekha Shah, the Liquidator of…

- **Court:** NCLT
- **Order date:** 22 Jan 2025
- **Citation:** TCN-2025-NCLT-00597
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/adya-oils-and-chemicals-ltd-36205b03

## Summary

### Background

The case involves an application (I.A. No. 1305 of 2020) filed by Rekha Shah, the Liquidator of Adya Oils and Chemicals Ltd., seeking directions against Sudhir Dinanath Chaturvedi & Anr (referred to as the “Respondent/Respondents”) under Section 66 of the Insolvency and Bankruptcy Code, 2016. The applicant seeks declaration of a loan transaction with IDBI bank by the Corporate Debtor as fraudulent, directions to obtain search reports, payment of stamp duty, conversion of agricultural property to NA, and demolition of a wall obstructing factory access. The Corporate Debtor was admitted to CIRP on 16.09.2019, and the applicant was appointed as the IRP. Subsequently, a liquidation order was passed on 04.03.2020 due to the absence of an approved resolution plan.

## Facts

Adya Oils and Chemicals Ltd. (Corporate Debtor) underwent Corporate Insolvency Resolution Process (CIRP) starting 16.09.2019, with Rekha Shah appointed as the Liquidator. The liquidation order was passed on 04.03.2020. During CIRP, claims were received from Stressed Assets Stabilisation Fund (SASF) related to a loan originally sanctioned by Industrial Development Bank of India (IDBI) in November 1997 for Rs. 700 Lakhs. The Corporate Debtor created an equitable mortgage in favor of IDBI. The first repayment of the loan was due on October 1, 2000, but default occurred on March 30, 2001. The security was created in 2001 by depositing title deeds on 13th December 2001, after the default. The original title deeds were not deposited at the time of security creation and were

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## Issues and analysis

### Issue 1: Whether the acts complained of in the present application make out a case under Section 66 of the …

**Ratio:** Section 66 of the IBC deals with fraudulent or wrongful trading. It requires

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**Reasoning:** The tribunal found that the Respondents No. 1, 2, and 3 acted in a fraudulent manner,

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**Interpretation:** Section 66 aims to address situations where the corporate debtor's business was

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**Application:** The tribunal applied Section 60(5) to address the fraudulent conduct of the

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## Parties

- **Judges:** Reeta K…; Madhu S…
- **Appellants:** Rekha…
- **Respondents:** Adya Oils &…; Adya Oils and…; +1 more

## Timeline

- **1997-11-01 — Loan San…**: IDBI sanctioned a loan of Rs.…
- **1998-12-22 — Loan Agreeme…**: Date of the Loan…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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