# In the matter of Privilege Power and Infrastructure Pvt. Ltd. C.P. 1358 OF 2020

> NCLT judgment dated 2023-02-15. Citation: TCN-2023-NCLT-04583. Unity Small Finance Bank (formerly Punjab & Maharashtra Co-operative Bank Ltd) filed a petition…

- **Court:** NCLT
- **Order date:** 15 Feb 2023
- **Citation:** TCN-2023-NCLT-04583
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/privilege-power-and-infrastructure-pvt-ltd-cp-1358-of-2020-5acebccf

## Summary

### Background

Unity Small Finance Bank (formerly Punjab & Maharashtra Co-operative Bank Ltd) filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Privilege Power and Infrastructure Pvt. Ltd. The petition pertains to an unresolved financial debt of Rs. 138,48,08,867.90. The Petitioner had initially extended financial assistance to the Respondent in 2007 through an overdraft facility, which was later renewed. The Respondent's account was classified as NPA in 2012. The Petitioner claims that the Respondent defaulted on payments, leading to the filing of the petition.

## Facts

In 2007, Privilege Power and Infrastructure Pvt. Ltd. (Respondent) approached Punjab & Maharashtra Co-operative Bank Ltd (now Unity Small Finance Bank, Petitioner) for financial assistance via an overdraft facility. The Petitioner opened an overdraft account and extended Rs. 11.81 Crores between 12.03.2007 and 31.03.2007. Subsequently, the Respondent executed a Demand Promissory Note dated 16.08.2018 and Mortgage Deeds dated 13.04.2017 and 24.05.2018. The Petitioner issued a 'Renewal of your Mortgage Overdraft Limit' for Rs. 81.50 Crores on 16.08.2018. The Respondent issued balance confirmations on multiple dates, including 27.06.2011, 11.07.2018, 07.08.2019, and 08.08.2019. The Corporate Debtor also issued a Letter of Continuing Security dated 16.08.2018 for Rs.

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## Issues and analysis

### Issue 1: Whether the petition is …

**Ratio:** Section 17 of the Limitation Act, 1963, provides that where the knowledge of the right or

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**Reasoning:** The court considered the Petitioner's argument that the limitation period should be

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**Interpretation:** The court interpreted Section 17 of the Limitation Act to mean that the

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**Application:** The court applied the principle that the limitation period starts from the date

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## Parties

- **Judges:** Kuldip Kumar…; ANURADHA SANJAY…
- **Appellants:** Unity Small…
- **Respondents:** Privilege Power…; Nausher…

## Timeline

- **2007-01-01 — Respondent approached…**: Respondent approached Petitioner for financial…
- **2007-03-12 — Overdraft facility…**: Petitioner started extending financial assistance by way of overdraft facility to the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 5(8) — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-5)

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