# In the matter of Sangola Taluka SahakariSakharKarkhana Limited CP(IB)No. 263-MB-2019

> NCLT judgment dated 2022-02-04. Citation: TCN-2022-NCLT-04261. The Solapur Dist. Central Co – Operative Bank Limited filed an application under Section 7 of…

- **Court:** NCLT
- **Order date:** 4 Feb 2022
- **Citation:** TCN-2022-NCLT-04261
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/sangola-taluka-sahakarisakharkarkhana-limited-cpibno-263-mb-2019-6598b385

## Summary

### Background

The Solapur Dist. Central Co – Operative Bank Limited filed an application under Section 7 of the Insolvency & Bankruptcy Code, 2016 (I&B Code) against Sangola Taluka SahakariSakharKarkhana Limited, seeking to initiate Corporate Insolvency Resolution Process (CIRP). The Financial Creditor claimed a total default of Rs. 8339.66 Lakhs with the date of default being 01.04.2016. The Corporate Debtor was given opportunities to appear but chose not to, and was set ex-parte. The Financial Creditor argued that the Code, 2016, includes registered co-operative societies and that the petition was within limitation, submitting an additional affidavit and audited financial statements to support this.

## Facts

The Solapur Dist. Central Co – Operative Bank Limited, the Financial Creditor, filed an application under Section 7 of the I&B Code, 2016, against Sangola Taluka SahakariSakharKarkhana Limited, the Corporate Debtor, to initiate CIRP. The Financial Creditor claimed a default of Rs. 8339.66 Lakhs, with the date of default being 01.04.2016. The Corporate Debtor had approached the Financial Creditor for loan facilities amounting to Rs. 8236.25 Lakhs for setting up a plant for sugar production. The Financial Creditor sanctioned and disbursed credit facilities from 2006 to 2011, including a restructured loan of Rs. 1336.26 lakhs. The Corporate Debtor defaulted on repayment, leading the Financial Creditor to initiate legal action under the Maharashtra State Cooperative

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## Issues and analysis

### Issue 1: Whether the Petition filed by the Financial Creditor under section 7 of the Code is well within …

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

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**Reasoning:** The Financial Creditor submitted an additional affidavit dated 11.11.2019 and audited

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**Interpretation:** The limitation period for initiating CIRP under Section 7 of the IBC is

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**Application:** The Financial Creditor provided audited financial statements acknowledging the

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## Parties

- **Judges:** RAJESH S…; H.V. Subb…
- **Appellants:** The Solapur Dist.…
- **Respondents:** Sangola Taluka…

## Timeline

- **2016-04-01 — Date of D…**: The date of default as…
- **2019-01-15 — Petition…**: The Financial Creditor filed…

## 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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