# In the matter of Shrivallabh Pittie Industries Ltd.

> NCLT judgment dated 2024-03-07. Citation: TCN-2024-NCLT-02159. State Bank of India filed a petition under Section 7 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 7 Mar 2024
- **Citation:** TCN-2024-NCLT-02159
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/shrivallabh-pittie-industries-ltd-9397047e

## Summary

### Background

State Bank of India filed a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Shrivallabh Pittie Industries Limited, alleging default on a financial debt. The Corporate Debtor is a private limited company incorporated on 31.08.2012, engaged in manufacturing cotton yarn, polyester, and cotton blend. The Financial Creditor claimed a default of Rs. 90,60,51,346.78/-. There was a discrepancy in the date of default, initially stated as 19.07.2021 but later clarified as 19.07.2022. The Corporate Debtor argued that the application was not maintainable due to the incorrect date of default and that the account was wrongfully declared NPA.

## Facts

State Bank of India (SBI), the Financial Creditor, filed a Company Petition (CP (IB)/ 440 (MB) 2023) under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Shrivallabh Pittie Industries Limited, the Corporate Debtor. The Corporate Debtor is a private limited company incorporated on 31.08.2012, involved in manufacturing cotton yarn, polyester, and cotton blend. SBI claimed that the Corporate Debtor defaulted on a total amount of Rs. 90,60,51,346.78/-, comprising a principal amount of Rs. 84,02,86,746, interest of Rs. 5,54,31,983, and penal interest of Rs. 1,03,32,617.72. The date of default was initially stated as 19.07.2021 but was later clarified to be 19.07.2022. SBI had granted a

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## Issues and analysis

### Issue 1: Whether the application filed by State Bank of India under Section 7 of the Insolvency and …

**Ratio:** Section 7 of the IBC allows a financial creditor to initiate CIRP against a corporate

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**Reasoning:** The NCLT considered the submissions of both parties, including the discrepancy in the

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**Interpretation:** The interpretation of Section 7 of the IBC and Rule 4 of the Insolvency and

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**Application:** In this case, the Financial Creditor demonstrated the existence of a debt and a

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## Parties

- **Judges:** V. G. Bisht…; SH. PRABHAT…
- **Appellants:** State Bank of…
- **Respondents:** Shrivallabh…

## Timeline

- **2012-08-31 — Incorporation of…**: Shrivallabh Pittie Industries Ltd.…
- **2015-10-12 — First Sanction of Term…**: Term Loan and other credit facilities were…

## 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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