# In the matter of Cheema Paper Mills Private Limited

> NCLT judgment dated 2024-05-14. Citation: TCN-2024-NCLT-01359. IDBI Bank Ltd. filed an application under Section 7 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 14 May 2024
- **Citation:** TCN-2024-NCLT-01359
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/cheema-paper-mills-private-limited-421bd9bd

## Summary

### Background

IDBI Bank Ltd. filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against M/s Cheema Paper Mills Pvt. Ltd. The application was filed due to the respondent's default on a Foreign Currency Loan (FCL) agreement and subsequent restructuring attempts. The respondent's liabilities were restructured multiple times, including under a Corporate Debt Restructuring (CDR) scheme, and a One-Time Settlement (OTS) was also attempted but failed. The account was classified as NPA on 31.12.2008.

## Facts

IDBI Bank Ltd. filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate CIRP against M/s Cheema Paper Mills Pvt. Ltd. The respondent executed a Foreign Currency Loan (FCL) agreement with the applicant for SF 10.64 million. The corporate debtor approached the applicant for conversion of its Foreign Currency Loan into Single Currency Pool Facility to re-pay the loan in rupee equivalent of the sanctioned facility i.e. SF 10.64 million, which was duly accepted by the Applicant while executing an Amendatory Agreement. The liabilities of the respondent were restructured multiple times, and a Corporate Debt Restructuring (CDR) scheme was implemented in December 2008. The corporate debtor was declared sick by BIFR in December 2010. An OTS

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## Issues and analysis

### Issue 1: Whether the present application is filed within the limitation period as per Section 7 of the IBC, …

**Ratio:** The Supreme Court extended the period of limitation vide its order dated 10.01.2022 in

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**Reasoning:** The court considered the Supreme Court's order extending the limitation period due to

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**Interpretation:** The Supreme Court's order provided relief to litigants by extending the

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**Application:** The court found that the application was filed within the extended limitation

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## Parties

- **Judges:** Sh. Harnam Singh…; SH. L. N.…
- **Appellants:** IDBI Bank…
- **Respondents:** M/s Cheema Paper…

## Timeline

- **2008-12-31 — Account Classified as…**: The account of the Respondent…
- **2013-03-18 — OTS Appr…**: The corporate debtor approached the Applicant for settlement of dues by way of OTS which…

## 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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