# In the matter of Johal & Co (Wine Sales) Private Limited I.A. (IB) 1537-KB-2022 And I.A. (IB) 317-KB-2023 And C.P. (IB) 935-KB-2018

> NCLT judgment dated 2023-04-17. Citation: TCN-2023-NCLT-03782. This is a Company Petition under Section 7 of the Insolvency and Bankruptcy Code, 2016 filed by…

- **Court:** NCLT
- **Order date:** 17 Apr 2023
- **Citation:** TCN-2023-NCLT-03782
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/johal-co-wine-sales-private-limited-ia-ib-1537-kb-2022-and-ia-ib-317-kb-2023-and-aaacfc0f

## Summary

### Background

This is a Company Petition under Section 7 of the Insolvency and Bankruptcy Code, 2016 filed by State Bank of India (Financial Creditor) seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Johal & Company (Wine Sales) Private Limited (Corporate Debtor). The Corporate Debtor is a private limited company incorporated on 09.01.1979. The authorized share-capital of the company is ₹5,00,00,000/- and the paid-up share capital of the company is ₹4,38,58,600/-. The amount claimed to be in default by the Financial Creditor is ₹68,03,18,652.66/-, inclusive of interest as on 31.03.2018 together with further interest @17.05% per annum from 01.04.2018 with monthly interests till realization. The date of default is 31.12.2015 which is also the declaration

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## Facts

State Bank of India (SBI) sanctioned a cash credit facility of ₹25,00,00,000/- to Johal & Company (Wine Sales) Private Limited on 21.07.2009. The Corporate Debtor hypothecated various properties with the Financial Creditor as consideration. The Financial Creditor enhanced the cash credit facility on multiple occasions, with the last enhancement on 28.09.2011. On 27.01.2014, the Corporate Debtor resolved to execute a revival letter in favor of the Financial Creditor, which was executed on 19.05.2014. Due to continued failure of the Corporate Debtor to regularize the loan account, the account was declared as Non-Performing Asset (NPA) on 31.12.2015. On 21.02.2017, the Financial Creditor issued a demand notice for ₹53,56,15,975.17. The Corporate Debtor did not clear

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## Issues and analysis

### Issue 1: Whether the application under Section 7 of the Insolvency and Bankruptcy Code, 2016 is within the …

**Ratio:** The limitation period for application under Section 7 of the I&B Code is three years

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**Reasoning:** The Adjudicating Authority relied on the decisions of the Hon'ble National Company Law

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**Interpretation:** The date of default is the date on which the Corporate Debtor's account was

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**Application:** The Corporate Debtor's account was declared NPA on 31.12.2015, and the petition

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## Parties

- **Judges:** Rohit K…; Balraj…; +1 more
- **Appellants:** State Bank of…
- **Respondents:** Johal & Company…

## Timeline

- **1979-01-09 — Incorporation of…**: Johal & Company (Wine Sales)…
- **2009-07-21 — Cash Credit Facility…**: State Bank of India sanctioned a cash credit facility of ₹25,00,00,000/- to the Corporate…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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