# In the matter of State Bank of India Vs. Vivek Sachdev, CP (IB)-754/ND/2021

> NCLT judgment dated 2023-03-03. Citation: TCN-2023-NCLT-04359. The State Bank of India sanctioned credit facilities to M/s Auto Décor Private Limited, which…

- **Court:** NCLT
- **Order date:** 3 Mar 2023
- **Citation:** TCN-2023-NCLT-04359
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/state-bank-of-india-vs-vivek-sachdev-cp-61307e01

## Summary

### Background

The State Bank of India sanctioned credit facilities to M/s Auto Décor Private Limited, which were reviewed and enhanced over time. The Corporate Debtor and Guarantors requested for renewal of working capital. The Petitioner sanctioned a Synthetic Letter of Credit (SLC) of Rs. 2.00 Crores, later converted to a Working Capital Term Loan (WCTL) of Rs. 49.67 Crores, and subsequently enhanced to Rs. 51.17 Crores. These facilities were secured by personal guarantees, including that of Mr. Vivek Sachdev. A compromise proposal for Rs. 16.50 crore was sanctioned but lapsed. The Corporate Debtor requested revival of the compromise proposal. The Petitioner approached the Debt Recovery Tribunal-II for recovery. OA No. 159 of 2017 is pending adjudication against the Corporate

…

## Facts

The State Bank of India (SBI) extended credit facilities to M/s Auto Décor Private Limited, which were periodically reviewed and enhanced. These facilities were backed by personal guarantees, including one from Mr. Vivek Sachdev. SBI sanctioned a Synthetic Letter of Credit (SLC) of Rs. 2.00 Crores, which was later converted into a Working Capital Term Loan (WCTL) of Rs. 49.67 Crores and subsequently increased to Rs. 51.17 Crores. A compromise proposal of Rs. 16.50 crore was sanctioned but lapsed due to non-payment. The Corporate Debtor requested a revival of the compromise. SBI initiated recovery proceedings before the Debt Recovery Tribunal-II. OA No. 159 of 2017 is pending adjudication against the Corporate Debtor. A CIRP was initiated by APPL Industries Limited

…

## Issues and analysis

### Issue 1: Whether the application filed by the Applicant bank satisfies the requirement as set out in Section …

**Ratio:** Section 95 of the IBC, 2016 outlines the requirements for initiating insolvency

…

**Reasoning:** The court considered the report of the Resolution Professional, which stated that the

…

**Interpretation:** Section 95 sets the procedural and substantive requirements for initiating

…

**Application:** The court relied on the RP's assessment that the application fulfilled the

…

## Parties

- **Judges:** SHRI. ASHOK KUMAR…; Shri. L. N.…
- **Appellants:** The State Bank of…
- **Respondents:** M/s Auto Décor…; Sh. Vivek S…

## Timeline

- **2013-01-10 — Sanction…**: Petitioner sanctioned SLC (Synthetic Letter of Credit) of Rs. 02.00 Crores vide…
- **2014-03-15 — Conversion…**: SLC was converted into WCTL (Working Capital Term Loan) vide arrangement letter to the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 95 — Application by creditor to initiate insolvency…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-95)

---

This is a preview. The full structured summary, issues, precedents and source judgment are available on CaseEase - Legal Intelligence Simplified: https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/state-bank-of-india-vs-vivek-sachdev-cp-61307e01