# In the matter of Coromandel Granities (I) Limited

> NCLT judgment dated 2023-12-14. Citation: TCN-2023-NCLT-00243. The case involves an application filed under Section 7 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 14 Dec 2023
- **Citation:** TCN-2023-NCLT-00243
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/coromandel-granities-i-limited-05454ee1

## Summary

### Background

The case involves an application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016, by Ashok Gupta, a financial creditor, against Coromandel Granites (I) Limited, the corporate debtor, for initiating the Corporate Insolvency Resolution Process (CIRP). The applicant claims that the corporate debtor defaulted on a loan of Rs. 1,23,00,000/- with an interest rate of 24% per annum. The applicant also served as the Chief Financial Officer and Director of the corporate debtor. The corporate debtor allegedly failed to repay the loan, leading to the dishonor of several post-dated cheques. The applicant then issued a legal notice to the corporate debtor, but no response or payment was received.

## Facts

Ashok Gupta, the applicant, claimed to have provided a loan of Rs. 1,23,00,000/- to Coromandel Granites (I) Limited, the corporate debtor, with an interest rate of 24% per annum. The loan was provided in various tranches via cheques drawn on Axis Bank. The applicant also served as the Chief Financial Officer and Director of the corporate debtor. The corporate debtor failed to repay the loan, and several post-dated cheques issued for repayment were dishonored due to insufficient funds. The applicant issued a legal notice to the corporate debtor, but no response or payment was received. The corporate debtor alleged that the applicant had stolen and misused signed cheques. The applicant filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to

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## Issues and analysis

### Issue 1: Whether the application filed by the Financial …

**Ratio:** Section 18 of the Limitation Act, 1963 states that when a cheque is issued, irrespective

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**Reasoning:** The court noted that the last post-dated cheque was returned on 17.02.2020 and the

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**Interpretation:** The issuance of a cheque, even if dishonored, serves as an acknowledgment of

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**Application:** The court applied the principle that the dishonor of cheques issued by the

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## Parties

- **Judges:** SANJIV…; Venkataraman…
- **Appellants:** Ashok G…
- **Respondents:** Coromandel…; Coromandel…
- **Advocates:** Athiban Vij…; B. Sarath…

## Timeline

- **1986-05-30 — Incorporation of…**: Coromandel Granites (I) Limited was incorporated with Authorized Share Capital of…
- **2018-12-31 — Demand Promissory Note…**: A Demand Promissory Note was executed along with an Affidavit by Shri. Mahaveer Bafna on…

## 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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