# In the matter of Neesa Agritech and Foods Limited CP (IB) 188-NCLT-AHM-2022

> NCLT judgment dated 2023-05-17. Citation: TCN-2023-NCLT-03314. State Bank of India filed an application under Section 7 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 17 May 2023
- **Citation:** TCN-2023-NCLT-03314
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/neesa-agritech-and-foods-limited-cp-ib-188-nclt-ahm-2022-03a658f5

## Summary

### Background

State Bank of India filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Neesa Agritech and Foods Limited, the corporate debtor, for initiating the Corporate Insolvency Resolution Process (CIRP). The application was based on the corporate debtor's failure to repay financial assistance granted by the applicant. The applicant claimed that the corporate debtor was in default of a significant amount, leading to its classification as a Non-Performing Asset (NPA). The application was supported by various documents, including loan agreements, balance confirmations, and legal notices.

## Facts

State Bank of India (SBI) filed an application under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016, against Neesa Agritech and Foods Limited, seeking to initiate the Corporate Insolvency Resolution Process (CIRP). SBI, acting as the financial creditor, had extended various credit facilities to Neesa Agritech. Due to non-payment, the account was classified as a Non-Performing Asset (NPA) on 31.05.2012. A Master Restructuring Agreement was executed on 23.03.2013 with Neesa Infrastructure Limited (original borrower) and other lenders. The corporate debtor provided a corporate guarantee and executed a deed of guarantee on 11.11.2011. SBI issued a legal notice on 16.10.2014, demanding payment of Rs. 61,29,06,186.00. The application was filed on 06.07.2022. The

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## Issues and analysis

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

**Ratio:** Section 7 of the IBC allows a financial creditor to initiate CIRP against a corporate

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**Reasoning:** The applicant, State Bank of India, is a financial creditor, and the corporate debtor,

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**Interpretation:** Section 7 provides the mechanism for financial creditors to trigger the

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**Application:** The applicant, being a financial creditor, has the right to file an application

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## Parties

- **Judges:** Deep Chandr…; Ajai Das Me…
- **Appellants:** State Bank of…
- **Respondents:** Neesa Agritech…
- **Advocates:** Vishal…

## Timeline

- **2012-05-31 — NPA Classif…**: Corporate debtor classified as Non-Performing Asset (NPA) in the books of accounts of the…
- **2013-03-23 — Master Restructuring…**: Master Restructuring Agreement executed between the principal borrower (Neesa…

## 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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