# In the matter of Adya Oils & Chemicals Ltd.

> NCLT judgment dated 2023-12-18. Citation: TCN-2023-NCLT-00199. The Interlocutory Application (I.A.) No. 883 of 2022 was filed by Stressed Assets Stabilisation…

- **Court:** NCLT
- **Order date:** 18 Dec 2023
- **Citation:** TCN-2023-NCLT-00199
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/adya-oils-chemicals-ltd-f87ae773

## Summary

### Background

The Interlocutory Application (I.A.) No. 883 of 2022 was filed by Stressed Assets Stabilisation Fund, the Applicant, seeking directions against Ms. Rekha Kantilal Shah, the Respondent, under Section 60(5) of the Insolvency & Bankruptcy Code, 2016. The Applicant sought to restrain the liquidator from selling assets of the Corporate Debtor, particularly land parcels, and from deleting assets from the liquidation estate. The Applicant's case stems from a term loan sanctioned by IDBI to Adya Oils and Chemicals Ltd., the Corporate Debtor, in December 1998, secured by immovable properties and personal guarantees. The debt was assigned to the Applicant in 2004. Disputes arose regarding the title and status of the land parcels, with issues of non-compliance with land laws

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## Facts

In December 1998, IDBI sanctioned a term loan of Rs. 7 Crores to Adya Oils and Chemicals Ltd. (Corporate Debtor), secured by a first charge on immovable properties. The loan was also secured by personal guarantees and a pledge of equity shares. The debt was assigned to Stressed Assets Stabilisation Fund (Applicant) in September 2004. Attempts to settle the debt failed. A legal search report in March 2016 indicated that the land given as security did not have clear mortgageable title. The Applicant filed CP 2392 of 2019 under Section 7 to initiate CIRP. The Applicant's claim was admitted, and a Committee of Creditors (CoC) was constituted with the Applicant holding 100% voting share. The Liquidator informed the CoC that some properties were still classified as

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## Issues and analysis

### Issue 1: Whether the land belonging to third party can …

**Ratio:** Section 36(4)(a) of the IBC, 2016, stipulates that assets owned by a third party, which

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**Reasoning:** The court reasoned that Block No. 81 was transferred to the Government of Gujarat, Block

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**Interpretation:** Section 36 of the IBC defines the scope and ambit of the liquidation estate,

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**Application:** The court applied Section 36(4)(a) to the specific facts, noting that the land

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## Parties

- **Judges:** Reeta K…; SANJIV…
- **Appellants:** Stressed Assets…
- **Respondents:** Adya Oils &…; Rekha Kantilal…

## Timeline

- **1998-12-01 — Loan San…**: IDBI sanctioned a term loan of Rs. 7…
- **2004-09-24 — Debt Assi…**: The debt of IDBI was assigned to Stressed…

## 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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