# In the matter of Simbhaoli Sugars Limited

> NCLT judgment dated 2024-07-11. Citation: TCN-2024-NCLT-01028. The case involves an application filed by Oriental Bank of Commerce (now Punjab National Bank)…

- **Court:** NCLT
- **Order date:** 11 Jul 2024
- **Citation:** TCN-2024-NCLT-01028
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/simbhaoli-sugars-limited-4843d7a7

## Summary

### Background

The case involves an application filed by Oriental Bank of Commerce (now Punjab National Bank) under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Simbhaoli Sugar Ltd., a corporate debtor, for initiating the Corporate Insolvency Resolution Process (CIRP). The application was initially filed on 17.09.2018, claiming a total financial debt of Rs. 1,03,61,04,783.00 as of 31.07.2018, with further interest. The corporate debtor defaulted on 31.08.2016. The application was later amended to substitute Punjab National Bank as the applicant due to the amalgamation of Oriental Bank of Commerce with Punjab National Bank.

## Facts

Oriental Bank of Commerce (now Punjab National Bank) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, against Simbhaoli Sugar Ltd. The initial application was filed on 17.09.2018, claiming a financial debt of Rs. 1,03,61,04,783.00 as of 31.07.2018, with a default date of 31.08.2016. The corporate debtor had availed a total credit facility of Rs. 110,00,00,000/-. The corporate debtor defaulted on repayment, leading to the account being classified as NPA on 30.11.2016. The corporate debtor failed to register a pari-passu charge on its assets. The corporate debtor pledged a Term Deposit Receipt (TDR) of Rs. 5,00,00,000 as additional security. The applicant conducted meetings for restructuring the loan account, but no restructuring proposal

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## Issues and analysis

### Issue 1: Whether there is debt and default within …

**Ratio:** The existence of an admitted debt and default is easily evident from the Facility Letter,

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**Reasoning:** The Corporate Debtor has admitted that the credit facility availed from the Financial

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**Interpretation:** The first issue for consideration before this tribunal for the purpose of

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**Application:** The default on the part of the CD is evident from the documents placed on

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## Parties

- **Judges:** Praveen…; Ashish…
- **Appellants:** Oriental Bank of…
- **Respondents:** Simbhaoli Sugar…

## Timeline

- **2018-09-17 — Application…**: Oriental Bank of Commerce filed an application under Section 7 of the IBC against…
- **2016-08-31 — Date of D…**: Corporate Debtor…

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