# In the matter of Patil Construction and Infrastructure Ltd.

> NCLT judgment dated 2025-03-04. Citation: TCN-2025-NCLT-00411. IFCI Limited filed a Company Petition against Patil Construction & Infrastructure Ltd. under…

- **Court:** NCLT
- **Order date:** 4 Mar 2025
- **Citation:** TCN-2025-NCLT-00411
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/patil-construction-and-infrastructure-ltd-3a50d564

## Summary

### Background

IFCI Limited filed a Company Petition against Patil Construction & Infrastructure Ltd. under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) due to a financial debt of Rs. 26,28,12,037/-. The corporate debtor had availed a corporate loan of Rs. 50 Crores, and despite modifications to the loan terms and execution of various security documents, the corporate debtor defaulted on repayment. The financial creditor issued recall notices and initiated SARFAESI proceedings. The corporate debtor proposed an OTS which was initially considered but later rejected by the financial creditor. The corporate debtor contended that the petition was barred by limitation and that a valid OTS arrangement existed.

## Facts

IFCI Limited (Financial Creditor) filed a petition against Patil Construction & Infrastructure Ltd. (Corporate Debtor) under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate CIRP. The Corporate Debtor had availed a corporate loan of Rs. 50 Crores from the Financial Creditor, with the date of default being 09.01.2018 (interest amount) and 15.07.2019 (principal amount). The Financial Creditor issued a recall notice on 09.08.2019 and classified the Corporate Debtor's account as NPA on 23.09.2019. The Financial Creditor also initiated SARFAESI proceedings. The Corporate Debtor submitted an OTS proposal on 24.04.2023, depositing Rs. 2,00,00,000/- and further amounts towards settlement. The OTS proposal was rejected by the Financial Creditor on

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## Issues and analysis

### Issue 1: Whether the present Petition …

**Ratio:** The limitation period for initiating CIRP is three years from the date of default.

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**Reasoning:** The NCLT considered the date of default as 09.01.2018. The three-year limitation period

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**Interpretation:** Section 18 of the Limitation Act, 1963 requires an acknowledgement to be made

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**Application:** The NCLT applied the extended limitation period and found that the

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## Parties

- **Judges:** Reeta K…; Madhu S…
- **Appellants:** IFCI Li…
- **Respondents:** M/s. Patil…

## Timeline

- **2015-03-02 — Letter of…**: Petitioner granted and sanctioned the Corporate Loan facility of Rs. 50 Crores to the…
- **2015-03-16 — Modification…**: Petitioner conveyed modification of certain…

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