# In the matter of S. Kumars Limited CP (IB) 3707-MB-2019

> NCLT judgment dated 2022-11-18. Citation: TCN-2022-NCLT-00407. The case pertains to a Company Petition filed by Edelweiss Asset Reconstruction Co. Ltd. under…

- **Court:** NCLT
- **Order date:** 18 Nov 2022
- **Citation:** TCN-2022-NCLT-00407
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/s-kumars-limited-cp-ib-3707-mb-2019-d5d90e6f

## Summary

### Background

The case pertains to a Company Petition filed by Edelweiss Asset Reconstruction Co. Ltd. under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against M/s. S. Kumars Limited, the Corporate Debtor. The petition alleges default in payment of a Financial Debt amounting to Rs. 4,14,29,20,070/-. The date of default is stated as 30.04.2010, and the date of declaration of the Principal Borrower's account as Non-Performing Asset (NPA) is 30.06.2010. The Financial Creditor claims that the debt was assigned to them by the original lender, Central Bank of India. The Corporate Debtor, however, contends that the petition is time-barred, as the default occurred in 2010, and the petition was filed much later.

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## Facts

In 2009, SKM Fabrics Limited, the original borrower, approached Central Bank of India for a loan. The bank granted working capital and term loan facilities amounting to Rs. 75 Crores and Rs. 49 Crores respectively. The borrower defaulted on 30.04.2010, and the account was declared NPA on 30.06.2010. The credit facilities were secured by a corporate guarantee dated 31.12.2011, given by M/s. S. Kumars Limited, the Corporate Debtor. The original lender assigned the debt to Edelweiss Asset Reconstruction Co. Ltd. on 28.03.2014. The Corporate Debtor issued revival letters on 18.02.2012 and 09.02.2015. The Financial Creditor issued a demand notice on 08.01.2015 under Section 13(2) of the SARFAESI Act, 2002. The Corporate Debtor filed its reply on 11.04.2022, contending that

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## Issues and analysis

### Issue 1: Whether the petition filed by the Financial Creditor is time-barred under the Insolvency and …

**Ratio:** The principle of limitation dictates that legal actions must be initiated within a

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**Reasoning:** The court considered the Corporate Debtor's argument that the petition was time-barred

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**Interpretation:** The interpretation of the Limitation Act, particularly Section 18, is crucial

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**Application:** The court applied the principle of limitation and Section 18 of the Limitation

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## Parties

- **Judges:** P.N. Des…; Shyam Babu…
- **Appellants:** Edelweiss Asset…
- **Respondents:** M/s S. Kumars…

## Timeline

- **2009-01-01 — Loan Appli…**: SKM Fabrics Limited approached…
- **2009-03-30 — Sanction…**: Central Bank of India granted working…

## 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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