# In the matter of Dharti Dredging and Infrastructure Limited CP (IB) No. 329-7-HDB-2020

> NCLT judgment dated 2022-04-05. Citation: TCN-2022-NCLT-03362. The State Bank of India filed a petition under Section 7 of the Insolvency & Bankruptcy Code…

- **Court:** NCLT
- **Order date:** 5 Apr 2022
- **Citation:** TCN-2022-NCLT-03362
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/dharti-dredging-and-infrastructure-limited-cp-ib-no-329-7-hdb-2020-a4e832bf

## Summary

### Background

The State Bank of India filed a petition under Section 7 of the Insolvency & Bankruptcy Code (IBC) against Dharti Dredging and Infrastructure Ltd, alleging a default in payment of a debt of Rs. 91,76,44,448.33/- plus interest. The Corporate Debtor availed credit facilities from the bank since 2007, which were later enhanced by a consortium of banks including ICICI Bank and Federal Bank. The consortium sanctioned credit facilities amounting to Rs. 399 crores, with SBI's share being Rs. 181 crores. The Corporate Debtor executed loan documentation and created hypothecation charges in favor of the Consortium Banks. The Corporate Debtor filed IA No. 1139/2020 seeking dismissal of the petition based on the insertion of Section 10-A of the IBC, arguing that the default

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## Facts

State Bank of India (SBI) filed a petition under Section 7 of the Insolvency and Bankruptcy Code (IBC) against Dharti Dredging and Infrastructure Ltd, claiming a default of Rs. 91,76,44,448.33 plus interest. Dharti Dredging had availed credit facilities from SBI since 2007, which were later enhanced by a consortium of banks including ICICI Bank and Federal Bank. The consortium sanctioned credit facilities of Rs. 399 crores, with SBI's share being Rs. 181 crores. Loan documentation was executed, and hypothecation charges were created in favor of the consortium. The account was classified as a Non-Performing Asset (NPA) on 30.06.2018. SBI initiated proceedings under Section 13(2) of the SARFAESI Act on 22.04.2019. SBI also filed OA No.146 of 2020 before the Debt Recovery

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## Issues and analysis

### Issue 1: Whether there is a financial debt due and payable by the Corporate Debtor, and if so, whether the …

**Ratio:** The debt the financial creditor has claimed was based on the credit facilities, both fund

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**Reasoning:** The record discloses that the account of the borrower has been declared as Non-Performing

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**Interpretation:** The existence of a financial debt is determined by examining the credit

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**Application:** In this case, the Corporate Debtor availed credit facilities from the

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## Parties

- **Judges:** N. Venkata…; Veera Brahma Rao…
- **Appellants:** State Bank of…
- **Respondents:** Dharti Dredging…

## Timeline

- **2007-01-01 — Credit Facilities…**: Corporate Debtor availed credit facilities from the Industrial Finance Branch of the Bank…
- **2010-06-09 — Loan Documentation…**: The Corporate Debtor and four others executed necessary loan documentation in favour of…

## 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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