# In the matter of Neeta Chemicals (India) Private Limited

> NCLT judgment dated 2024-12-18. Citation: TCN-2024-NCLT-00035. The case involves an application filed by State Bank of India (SBI), a financial creditor,…

- **Court:** NCLT
- **Order date:** 18 Dec 2024
- **Citation:** TCN-2024-NCLT-00035
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/neeta-chemicals-india-private-limited-c225b646

## Summary

### Background

The case involves an application filed by State Bank of India (SBI), a financial creditor, under Section 60(5) of the Insolvency and Bankruptcy Code (IBC) 2016, seeking several reliefs related to the liquidation process of Neeta Chemicals (India) Private Limited (Corporate Debtor). The CIRP was initiated under Section 10 of IBC, and the petition was admitted on 2018-05-14. Later, the Corporate Debtor was ordered for liquidation on 2019-06-28. SBI, having sanctioned credit facilities to the Corporate Debtor, relinquished its security interest and became the sole member of the Stakeholder Consultation Committee (SCC). The application primarily contests the actions of the Liquidator, particularly regarding the attempted assignment of a Not Readily Realizable Asset (NRRA),

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## Facts

Neeta Chemicals (India) Private Limited (Corporate Debtor) underwent Corporate Insolvency Resolution Process (CIRP) initiated under Section 10 of the IBC, admitted on 2018-05-14, and subsequently faced liquidation ordered on 2019-06-28. State Bank of India (SBI) sanctioned credit facilities of Rs 197.80 Crores to the Corporate Debtor, secured by the Corporate Debtor's assets. SBI relinquished its security interest, becoming the sole member of the Stakeholder Consultation Committee (SCC). The Corporate Debtor possessed two main assets: Asset No. 1 (plot bearing No. 151) and Asset No. 2 (open land in Sy.No 60/part). Asset No. 1 was sold in an e-auction on 2020-12-07, while Asset No. 2 faced challenges due to claims from the endowment department under Section 22A of the

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## Issues and analysis

### Issue 1: Whether the Liquidator adhered to the prescribed procedures and regulations in attempting to assign …

**Ratio:** Regulation 37A of the Liquidation Regulations allows a liquidator to assign or transfer a

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**Reasoning:** The NCLT found that the Liquidator did not follow the prescribed procedures for receiving

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**Interpretation:** Regulation 37A mandates a transparent process and consultation with the SCC.

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**Application:** The Liquidator received an offer from Respondent No. 2 on 2023-05-15, after the

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## Parties

- **Judges:** Rajeev Bh…; Sanjay…
- **Appellants:** State Bank of…
- **Respondents:** Neeta Chemicals…

## Timeline

- **2018-05-14 — CIRP Init…**: Petition seeking initiation of Corporate Insolvency Resolution Process (CIRP) under…
- **2019-06-28 — Liquidation…**: The Corporate Debtor was…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 10 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-10)

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