# In the matter of Khandesh Builders Private Limited

> NCLT judgment dated 2023-10-20. Citation: TCN-2023-NCLT-01041. M/s JM Cotton Ginning and Pressing Company Private Limited filed a company petition under…

- **Court:** NCLT
- **Order date:** 20 Oct 2023
- **Citation:** TCN-2023-NCLT-01041
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/khandesh-builders-private-limited-a2e17bd2

## Summary

### Background

M/s JM Cotton Ginning and Pressing Company Private Limited filed a company petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against M/s Khandesh Builders Private Limited, alleging default in payment. The petition was based on an Inter Corporate Loan (ICL) agreement. The Corporate Debtor had requested an ICL of Rs. 12,00,00,000/- in 2004, and the Financial Creditor approved it. The Corporate Debtor made payments between 2005 and 2010, leaving an outstanding amount of Rs. 7,81,55,726/- as of 31.03.2010. An Inter Corporate Loan Agreement was executed on 31.03.2010. The Corporate Debtor defaulted on repayment, and the Financial Creditor sent letters requesting repayment from 2011 to

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## Facts

M/s JM Cotton Ginning and Pressing Company Private Limited (Financial Creditor) filed a petition against M/s Khandesh Builders Private Limited (Corporate Debtor) under Section 7 of the Insolvency and Bankruptcy Code, 2016. The Corporate Debtor had requested an Inter Corporate Loan (ICL) of Rs. 12,00,00,000/- in 2004, which was approved by the Financial Creditor. The Corporate Debtor made payments between 2005 and 2010, leaving an outstanding amount of Rs. 7,81,55,726/- as of 31.03.2010. An Inter Corporate Loan Agreement was executed on 31.03.2010. The Corporate Debtor defaulted on repayment, and the Financial Creditor sent letters requesting repayment from 2011 to 2021. A demand notice was sent on 15.10.2022, demanding Rs. 25,78,69,618/-. The Corporate Debtor failed to

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## Issues and analysis

### Issue 1: Whether the petition filed by the Financial Creditor is within the period of limitation as …

**Ratio:** The acknowledgment of debt has to be made before the expiry of the period of limitation.

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**Reasoning:** The court observed that there was a gap of more than three years between the letter dated

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**Interpretation:** The legal principle of limitation requires that legal actions must be initiated

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**Application:** In this case, the court applied the principle by examining the dates of

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## Parties

- **Judges:** Kuldip Kumar…; ANIL RAJ C…
- **Appellants:** M/s JM Cotton…
- **Respondents:** M/s Khandesh…

## Timeline

- **2004-01-01 — ICL Requ…**: The Corporate Debtor requested an Inter Corporate Loan (ICL) of Rs. 12,00,00,000/- from…
- **2004-04-02 — ICL Appr…**: The board of directors of the Financial Creditor approved the request of the Corporate…

## 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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