# In the matter of Vee Ess Jewellers Limited Company Petition No. (IB)-528(ND)-2022

> NCLT judgment dated 2023-01-24. Citation: TCN-2023-NCLT-04920. State Bank of India filed an application under Section 7 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 24 Jan 2023
- **Citation:** TCN-2023-NCLT-04920
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/vee-ess-jewellers-limited-company-petition-no-ib-528nd-2022-640cb36a

## Summary

### Background

State Bank of India filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against M/s. Vee Ess Jewellers Private Limited. The application was based on the corporate debtor's failure to repay a debt of Rs. 191,70,75,765.66 as of April 30, 2022. The bank had previously granted loan/credit facilities to the corporate debtor, which was initially a partnership firm, to the tune of Rs. 22.20 crores in 2005. The corporate debtor failed to maintain financial discipline despite repeated requests and reminders from the bank. The bank issued a notice under Section 13(2) of the SARFAESI Act, 2002, and later filed an Original Application before the Debts Recovery Tribunal (DRT) seeking

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## Facts

State Bank of India (SBI) extended credit facilities to M/s. Vee Ess Jewellers, initially a partnership firm, amounting to Rs. 22.20 crores. The partnership firm later became a private limited company, M/s. Vee Ess Jewellers Private Limited. The Corporate Debtor defaulted on repayments, leading SBI to classify the account as NPA on 30.09.2008. SBI initiated recovery proceedings before the Debts Recovery Tribunal (DRT), which culminated in a final order dated 07.07.2017 and the issuance of a Recovery Certificate. Despite these recovery efforts, a substantial debt of Rs. 191,70,75,765.66 remained outstanding as of 30.04.2022. SBI filed an application under Section 7 of the Insolvency and Bankruptcy Code (IBC) to initiate Corporate Insolvency Resolution Process (CIRP)

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## Issues and analysis

### Issue 1: Whether a final judgment and decree of the DRT in favour of the financial creditor, or issue of a …

**Ratio:** A judgment and/or decree for money in favour of the Financial Creditor, passed by the

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**Reasoning:** The Adjudicating Authority relied on the Hon'ble Supreme Court's judgment in Dena Bank

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**Interpretation:** The Supreme Court's interpretation clarifies that a Recovery Certificate

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**Application:** In this case, the Recovery Certificate dated 07.07.2017 issued in favor of the

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## Parties

- **Judges:** P.S.N. P…; BINOD KUMAR…
- **Appellants:** State Bank of…
- **Respondents:** M/S. Vee Ess…; M/s. Vee Ess…

## Timeline

- **2005-01-01 — Loan/Credit Facilities…**: Applicant Bank granted various loan/ credit facilities to the Corporate Debtor to the…
- **2006-03-01 — Incorporation of…**: The Corporate Debtor was incorporated under the name and style of ‘M/s. Vee Ess Jewellers…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60 — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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