# In the matter of GPT Steel Industries Limited

> NCLT judgment dated 2024-04-08. Citation: TCN-2024-NCLT-01785. This is an application (IA 461/NCLT/AHM/2022) filed by the Resolution Professional (RP) of GPT…

- **Court:** NCLT
- **Order date:** 8 Apr 2024
- **Citation:** TCN-2024-NCLT-01785
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/gpt-steel-industries-limited-e1384f10

## Summary

### Background

This is an application (IA 461/NCLT/AHM/2022) filed by the Resolution Professional (RP) of GPT Steel Industries Limited under Section 14 read with Section 60(5)(c) of the Insolvency and Bankruptcy Code, 2016 and Rule 11 of the NCLT Rules, 2016, seeking to quash and set aside show cause notices/termination order dated 07.04.2022 issued by the Gujarat Industrial Development Corporation (GIDC). The GIDC had issued a letter in Form F on 30.07.2019 for an amount of Rs.3,96,92,490 due and payable. The RP partially paid the claim amounting to Rs.1,01,65,984. The GIDC clarified on 11.09.2019 that the company was liable to pay interest at 15% on power supply cost and demanded payment from 01.01.2005 till the resolution process is finalized, potentially claiming an additional

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## Facts

The Resolution Professional (RP) of GPT Steel Industries Limited filed an application against Gujarat Industrial Development Corporation (GIDC) concerning a lease agreement. GIDC claimed outstanding dues, including interest, based on the lease deed executed on 06.10.2004. GIDC issued a letter in Form F on 30.07.2019 for an amount of Rs.3,96,92,490 due and payable. The RP made a partial payment of Rs.1,01,65,984. GIDC demanded interest at 15% on power supply costs from 01.01.2005 until the resolution process was finalized, potentially claiming an additional Rs.1,72,92,336. GIDC issued a show cause notice on 07.04.2022 under Sec 4(1) of the GPP Act for recovering Rs.69,82,644 and issued a termination of lease deed agreement to the Corporate Debtor. The RP argued that the

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## Issues and analysis

### Issue 1: Whether the demand and …

**Ratio:** Leasehold lands are owned by the Respondents and are not absolute properties of the

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**Reasoning:** The Tribunal reasoned that the RP has to move to the Appellate Authority of the

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**Interpretation:** The interpretation is that the IBC's protective umbrella for CIRP cannot be

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**Application:** The RP is directed to move the Appellate Authority of the respondent for

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## Parties

- **Judges:** Chitra Ha…; Velamur G Venkata…
- **Appellants:** Divyesh…
- **Respondents:** GPT Steel…; Gujarat Industrial…

## Timeline

- **2019-07-30 — GIDC issues…**: GIDC issued a letter in Form F for an…
- **2019-08-06 — Partial Payme…**: The Resolution Professional paid a claim…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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