# In the matter of Sabitri Industries Pvt. Ltd. I.A(IB)No.135-CB-2023 in C.P(IB) No.34-CB-2020

> NCLT judgment dated 2023-07-03. Citation: TCN-2023-NCLT-02717. The application was filed by Mr. Sambhulal Agarwal, the Resolution Professional of Sabitri…

- **Court:** NCLT
- **Order date:** 3 Jul 2023
- **Citation:** TCN-2023-NCLT-02717
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/sabitri-industries-pvt-ltd-iaibno135-cb-2023-in-cpib-no34-cb-2020-72aa770b

## Summary

### Background

The application was filed by Mr. Sambhulal Agarwal, the Resolution Professional of Sabitri Industries Pvt Ltd, regarding the Corporate Insolvency Resolution Process (CIRP). The CIRP against the corporate debtor was admitted under Section 7 of the IBC, 2016, by the Adjudicating Authority on June 3, 2022. The applicant was initially appointed as Interim Resolution Professional and later as Resolution Professional on July 5, 2022. Public announcements were made, and three expressions of interest were received. The resolution plans submitted by B.K. Agro Products Private Limited and Fortis Chemicals Private Limited contained clauses that allowed for modification or revocation, which was deemed unacceptable based on legal opinion and CoC's assessment.

## Facts

Mr. Sambhulal Agarwal, the Resolution Professional of Sabitri Industries Pvt Ltd, filed an application for liquidation. The CIRP against Sabitri Industries Pvt Ltd was admitted on June 3, 2022. Mr. Agarwal was appointed as the Interim Resolution Professional and later as the Resolution Professional. Public announcements were made, and three expressions of interest were received from B.K. Agro products private. Limited, Shri Annapurna Rice Mill and Fortish Chemical Private Limited. B.K. Agro Products Private Limited's resolution plan contained clauses allowing for modification or revocation. A legal opinion was obtained stating that such clauses were not permissible after approval by the CoC and NCLT. The CoC rejected both resolution plans and recommended liquidation.

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## Issues and analysis

### Issue 1: Whether the resolution plans submitted by B.K. Agro Products Private Limited and Fortis Chemicals …

**Ratio:** Resolution plans must comply with the requirements of the IBC, including Section

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**Reasoning:** The CoC considered the legal opinion that clauses allowing for modification or revocation

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**Interpretation:** The IBC aims to provide a framework for the resolution of corporate insolvency

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**Application:** The CoC applied the legal principle that resolution plans must comply with the

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## Parties

- **Judges:** P. Moha…; Satya Ranjan…
- **Appellants:** SAMBHULAL A…
- **Respondents:** Sabitri Industries…; State Bank of…

## Timeline

- **2022-06-03 — CIRP Admi…**: The Corporate Insolvency Resolution Process (CIRP) against Sabitri Industries Pvt Ltd was…
- **2022-07-05 — Appointment…**: Mr. Sambhulal Agarwal was appointed as…

## 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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