# In the matter of S R TIMBER PRODUCTS PRIVATE LIMITED

> NCLT judgment dated 2025-04-07. Citation: TCN-2025-NCLT-00237. The case pertains to a petition filed by State Bank of India (SBI), the Financial Creditor…

- **Court:** NCLT
- **Order date:** 7 Apr 2025
- **Citation:** TCN-2025-NCLT-00237
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/s-r-timber-products-private-limited-01096783

## Summary

### Background

The case pertains to a petition filed by State Bank of India (SBI), the Financial Creditor (FC), under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against S R Timber Products Private Limited, the Corporate Debtor (CD). The FC claims a default of Rs. 111,70,27,214.78. The CD was incorporated on 02.11.2004. The FC sanctioned credit facilities to the CD aggregating to Rs. 1300 Lacs on 28.03.2008, which was later increased to Rs. 2090 Lacs on 19.06.2009. The CD deposited title deeds on 22.08.2008 to create an equitable mortgage. The CD also executed supplemental agreements of loan cum hypothecation. The loan accounts were classified as NPA on 31.03.2014. The FC issued a demand notice on

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## Facts

State Bank of India (SBI), the Financial Creditor (FC), filed a petition under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against S R Timber Products Private Limited, the Corporate Debtor (CD). The FC claimed a default of Rs. 111,70,27,214.78. The CD was incorporated on 02.11.2004. On 21.01.2008, the CD applied for sanction/renewal of working capital credit facilities. The FC sanctioned credit facilities aggregating to Rs. 1300 Lacs on 28.03.2008, comprising fund-based limits (Cash Credit of Rs. 400 Lacs) and non-fund-based limits (Letter of Credit of Rs. 900 Lacs). The CD deposited original title deeds on 22.08.2008 to create an equitable mortgage. A supplemental agreement of loan cum

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## Issues and analysis

### Issue 1: Whether the debt and default exist as …

**Ratio:** The essentials for financial debt and financial creditor as defined in Section 5(8) of

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**Reasoning:** The NCLT relied on the OTS proposal given by the CD to the FC on 30.03.2023 as a clear

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**Interpretation:** The acknowledgment of debt in the OTS proposal and the consistent rundown

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**Application:** The NCLT applied the ratio to the facts of the case, noting that the OTS

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## Parties

- **Judges:** BIDISHA BA…; SAMEER…
- **Appellants:** State Bank of…
- **Respondents:** S R Timber…
- **Advocates:** Mr Snehasish…; Mr Shaunak…; +1 more

## Timeline

- **2004-11-02 — Incorporation of…**: S R Timber Products Private…
- **2008-01-21 — Application for Credit…**: The Corporate Debtor applied for…

## 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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