# In the matter of Kerala Chamber of Commerce & Industries CP(IB)-33-KOB-2021

> NCLT judgment dated 2022-02-21. Citation: TCN-2022-NCLT-04047. The case involves an application filed by Phoenix ARC Private Ltd, the Financial Creditor,…

- **Court:** NCLT
- **Order date:** 21 Feb 2022
- **Citation:** TCN-2022-NCLT-04047
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/kerala-chamber-of-commerce-industries-cpib-33-kob-2021-174f9c94

## Summary

### Background

The case involves an application filed by Phoenix ARC Private Ltd, the Financial Creditor, against Kerala Chamber of Commerce and Industries, the Corporate Debtor, under Section 7 of the Insolvency and Bankruptcy Code, 2016, for initiating Corporate Insolvency Resolution Process (CIRP). The Corporate Debtor had availed various credit facilities from South Indian Bank, which were later assigned to Phoenix ARC. The Financial Creditor claimed a total amount of Rs. 8,60,00,000/- was due. The Corporate Debtor opposed the application, raising issues of limitation and arguing that the applicant was not a financial creditor. The Corporate Debtor also argued that it is a Section 8 company and the loan was ultra vires its Memorandum of Association.

## Facts

Kerala Chamber of Commerce and Industries (Corporate Debtor) availed credit facilities from South Indian Bank. On 15.09.2010, South Indian Bank sanctioned a loan of Rs. 110 Lakhs for purchasing passenger elevators and generators. On 30.12.2010, another loan of Rs. 500 Lakhs was sanctioned for constructing a residential-cum-commercial building. On 01.01.2013, another loan of Rs. 250 Lakhs was sanctioned to purchase and install AC units. The Corporate Debtor acknowledged the debt in its balance sheets until 2019. The loan accounts became NPA on 30.09.2013. Phoenix ARC Private Ltd (Financial Creditor), as assignee of South Indian Bank, filed an application under Section 7 of the IBC claiming Rs. 8,60,00,000/- was due. The Corporate Debtor argued that the application was

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## Issues and analysis

### Issue 1: Whether the application …

**Ratio:** Section 238A of the IBC incorporates the Limitation Act, 1963. Section 18 of the

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**Reasoning:** The Tribunal considered the contention regarding limitation and referred to Section 238A

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**Interpretation:** The acknowledgment of debt in the Corporate Debtor's financial statements,

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**Application:** The Financial Creditor filed the application on 01.09.2021, which was within

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## Parties

- **Judges:** Ashok Kumar…; Anil Ku…
- **Respondents:** Kerala Chamber of…; M/s. Kerala…

## Timeline

- **2010-09-15 — Loan Sanc…**: South Indian Bank sanctioned a loan of Rs. 110 Lakhs for the purchase of Passenger…
- **2010-12-30 — Loan Sanc…**: Another loan of Rs. 500 Lakhs was sanctioned for the construction of a…

## 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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