# In the matter of KLT Automotive and Tublar Products Limited

> NCLT judgment dated 2024-09-26. Citation: TCN-2024-NCLT-00534. Phoenix ARC Private Limited, the Financial Creditor/Petitioner, filed a Company Petition…

- **Court:** NCLT
- **Order date:** 26 Sept 2024
- **Citation:** TCN-2024-NCLT-00534
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/klt-automotive-and-tublar-products-limited-68b24fe6

## Summary

### Background

Phoenix ARC Private Limited, the Financial Creditor/Petitioner, filed a Company Petition (IB)-881(MB)/2023 under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against KLT Automotive and Tublar Products Limited, the Corporate Debtor/Respondent. The petition was filed due to the Corporate Debtor's default in repayment of Rs. 9,68,20,63,285/-. The debt was initially assigned by Bank of India, KKR India Financial Services Limited, and Corporation Bank to Phoenix Trust FY 19 - 11, Phoenix Trust FY 19 - 13, and Phoenix Trust FY 19 - 20 respectively. The Corporate Debtor's account was declared a Non-Performing Asset (NPA) with effect from 31.03.2015. Several settlement attempts and restructuring

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## Facts

The Corporate Debtor, KLT Automotive and Tublar Products Limited, availed various credit facilities from Bank of India, KKR India Financial Services Limited, and Corporation Bank. These debts were subsequently assigned to Phoenix ARC Private Limited. The Corporate Debtor defaulted on repayment, leading to the accounts being declared as Non-Performing Assets (NPA) from 31.03.2015. Several attempts were made to restructure and settle the debts through Letters of Acceptance (LoA), but the Corporate Debtor failed to comply with the agreed terms. The Petitioner, Phoenix ARC Private Limited, recalled the financial facilities and initiated recovery proceedings before the Debts Recovery Tribunal (DRT). The DRT issued a Recovery Certificate in favor of the Petitioner. The

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## Issues and analysis

### Issue 1: Whether the date of Recovery Certificate can …

**Ratio:** The landmark judgment of the Hon'ble Supreme Court in Dena Bank Vs. C. Shivakumar Reddy

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**Reasoning:** The NCLT relied on the Supreme Court's judgment in Dena Bank Vs. C. Shivakumar Reddy,

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**Interpretation:** The interpretation is that the issuance of a Recovery Certificate by the DRT

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**Application:** The NCLT applied this ratio to the present case, noting that the Petitioner had

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## Parties

- **Judges:** LAKSHMI G…; Charanjeet Singh…
- **Appellants:** Phoenix Arc…
- **Respondents:** KLT Automotive…

## Timeline

- **2015-03-31 — Account Decla…**: The account of the Corporate Debtor was declared a Non-Performing Asset with effect from…
- **2019-01-24 — Tripartite Assignment…**: Debt owed by the Corporate Debtor to Bank of India was assigned to the Petitioner vide 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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