# In the matter of Kandla Energy and Chemicals Limited CP (IB) 128-NCLT-AHM-2021

> NCLT judgment dated 2022-10-21. Citation: TCN-2022-NCLT-00626. State Bank of India filed an application under Section 7 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 21 Oct 2022
- **Citation:** TCN-2022-NCLT-00626
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/kandla-energy-and-chemicals-limited-cp-ib-128-nclt-ahm-2021-6a5f6419

## Summary

### Background

State Bank of India filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Kandla Energy and Chemicals Limited, seeking to initiate the Corporate Insolvency Resolution Process (CIRP). The application was filed due to the corporate debtor's default on financial facilities granted by the applicant. The corporate debtor raised objections, including the application being defective, time-barred, and challenging the terms of the financial facilities. The applicant countered these objections, asserting the validity of the application and the existence of a debt and default.

## Facts

State Bank of India (SBI) filed an application under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016, against Kandla Energy and Chemicals Limited, seeking to initiate Corporate Insolvency Resolution Process (CIRP). SBI had granted various credit facilities to Kandla Energy and Chemicals Limited totaling Rs. 171.85 crore on 22.01.2013. Due to non-payment, the account was classified as a Non-Performing Asset (NPA) on 22.07.2014. SBI filed an Original Application before the Debt Recovery Tribunal (DRT), Ahmedabad, on 21.10.2015, for a claim of Rs. 125,95,46,082.83. The corporate debtor proposed one-time settlements on 01.12.2016, 12.04.2017, 28.06.2017 and 22.09.2017. DRT, Ahmedabad, passed an order on 25.06.2018, allowing SBI's application. The corporate

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## Issues and analysis

### Issue 1: Whether the application filed by the financial creditor is defective due to improper attestation of …

**Ratio:** The application is not defective if each page is sealed and signed by a Senior Officer of

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**Reasoning:** The NCLT observed that each page of the application was sealed and signed by a Senior

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**Interpretation:** The NCLT interpreted the requirement for proper attestation of documents to be

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**Application:** The NCLT found that the application was not defective because the documents

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## Parties

- **Judges:** DEEPTI M…; Ajai Das Me…
- **Appellants:** State Bank of…
- **Respondents:** KANDLA ENERGY AND…

## Timeline

- **2013-01-22 — Grant of Credit…**: State Bank of India granted various credit facilities to Kandla Energy and Chemicals…
- **2014-07-22 — Account Classified as…**: Due to non-payment, the account of Kandla Energy and Chemicals Limited was classified as…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14(1) — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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