# In the matter of Syntex Trading & Agency Private Limited IA 350-2023 in CP (IB) No. 841-MB-IV-2022

> NCLT judgment dated 2023-06-09. Citation: TCN-2023-NCLT-03029. Central Bank of India, the Financial Creditor, filed an application under Section 7 of the…

- **Court:** NCLT
- **Order date:** 9 Jun 2023
- **Citation:** TCN-2023-NCLT-03029
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/syntex-trading-agency-private-limited-ia-350-2023-in-cp-ib-no-841-mb-iv-2022-4b33aa30

## Summary

### Background

Central Bank of India, the Financial Creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate Corporate Insolvency Resolution Process (CIRP) against Syntex Trading & Agency Private Limited, the Corporate Debtor. The Financial Creditor had sanctioned term loans to Anjana Retail Infrastructure Private Limited and RJ Texcot Private Limited, which were later merged with the Corporate Debtor. The Corporate Debtor defaulted on its repayment obligations, leading to the filing of the application. The Corporate Debtor argued that the application was barred by Section 10A of the IBC and that the Financial Creditor was pursuing multiple proceedings for the same debt.

## Facts

The Central Bank of India sanctioned term loans to Anjana Retail Infrastructure Private Limited and RJ Texcot Private Limited. These companies were later merged with Syntex Trading & Agency Private Limited (Corporate Debtor). The Financial Creditor sanctioned fresh term loans to the Corporate Debtor. The facilities were secured by pledge of shares of Future Market Network Limited, Future Enterprises Limited, and Future Consumer Limited. The Corporate Debtor committed a default on 30.09.2020 and requested for One Time Restructuring (OTR) which was sanctioned on 21.05.2021. The date of default under the OTR is stated to be 31.03.2022. The Corporate Debtor failed to honor the debt obligations under OTR. The Financial Creditor sent a default notice dated 04.05.2022.

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## Issues and analysis

### Issue 1: Whether the application under Section 7 of the …

**Ratio:** Section 10A of the IBC prohibits the initiation of CIRP for defaults occurring during a

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**Reasoning:** The NCLT found that the initial date of default ceases to exist upon One-time

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**Interpretation:** Section 10A is interpreted to mean that if a restructuring takes place, the

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**Application:** The NCLT applied this reasoning to the facts and found that the default

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## Parties

- **Judges:** Prabhat…; KISHORE VEMULAPALL…
- **Appellants:** Central Bank of…
- **Respondents:** Syntex Trading &…
- **Advocates:** Abdullah Q…; Ankit L…

## Timeline

- **2015-03-24 — Sanction…**: Financial Creditor…
- **2016-12-05 — Sanction…**: Financial Creditor…

## 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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