# In the matter of Darjeeling Organic tea Estates Pvt. Ltd.

> NCLT judgment dated 2022-10-28. Citation: TCN-2022-NCLT-00593. UCO Bank filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, against…

- **Court:** NCLT
- **Order date:** 28 Oct 2022
- **Citation:** TCN-2022-NCLT-00593
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/darjeeling-organic-tea-estates-pvt-ltd-61c02f97

## Summary

### Background

UCO Bank filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Darjeeling Organic Tea Estates Private Limited, seeking to initiate the Corporate Insolvency Resolution Process (CIRP). The financial creditor, UCO Bank, claimed that the corporate debtor defaulted on its debt obligations. The corporate debtor argued against the initiation of CIRP, citing reasons such as the petition being barred by limitation, failure of the financial creditor to grant relief under the Master Direction of the RBI, and the existence of ongoing restructuring discussions. The corporate debtor also highlighted investments from foreign investors and its continued operations despite being declared a Non-Performing Asset (NPA).

## Facts

UCO Bank provided credit facilities to Darjeeling Organic Tea Estates Private Limited. In March 2016, the credit facilities were enhanced to ₹1,01,98,00,000/-. The corporate debtor executed various documents as annexures to the petition. The corporate debtor approached the financial creditor for review and renewal of the credit facilities, which was approved on 07.04.2017. The corporate debtor and personal guarantors hypothecated various assets to secure the credit facilities. The corporate debtor signed a balance confirmation on 06.11.2017, acknowledging an amount of ₹101,71,00,000/- due and payable. The corporate debtor defaulted on repayments, and the account was declared an NPA on 30.06.2017. The financial creditor issued a notice under Section 13(2) of the

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## Issues and analysis

### Issue 1: Whether the petition filed by the …

**Ratio:** Section 18 of the Limitation Act, 1963, states that acknowledgment of debt in writing

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**Reasoning:** The NCLT found that the Corporate Debtor had given a balance confirmation dated November

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**Interpretation:** The acknowledgment of debt and part payments made by the Corporate Debtor reset

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**Application:** The Corporate Debtor's acknowledgment of debt on November 06, 2017, and

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## Parties

- **Judges:** RohitKa…; Balraj…
- **Appellants:** UCO B…
- **Respondents:** M/s. Darjeeling…

## Timeline

- **2016-03-01 — Enhancement of Credit…**: Credit facilities enhanced to…
- **2017-03-31 — Date of First…**: Date of first default in…

## 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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