# In the matter of Visa Steel Limited TP No. 40-CTB-2019 (Formerly CP (IB) No. 24-KB-2018

> NCLT judgment dated 2022-11-28. Citation: TCN-2022-NCLT-00318. State Bank of India filed an application under Section 7 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 28 Nov 2022
- **Citation:** TCN-2022-NCLT-00318
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/visa-steel-limited-tp-no-40-ctb-2019-formerly-cp-ib-no-24-kb-2018-3d904512

## Summary

### Background

State Bank of India filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate the Corporate Insolvency Resolution Process (CIRP) against Visa Steel Limited. The financial creditor had sanctioned several loans and credit facilities to the corporate debtor between 2006 and 2009. The corporate debtor defaulted, leading to a Master Restructure Agreement in 2012. However, the debtor failed to adhere to the payment terms. The account was declared NPA, and the petition was filed before NCLT, Kolkata, on 21.12.2017. The respondent challenged the maintainability of the petition, which was initially allowed and the petition dismissed. However, the NCLAT allowed an appeal by the financial creditor. The respondent then appealed to the

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## Facts

State Bank of India (SBI), the financial creditor, filed an application under Section 7 of the Insolvency and Bankruptcy Code (IBC) against Visa Steel Limited, the corporate debtor, seeking to initiate the Corporate Insolvency Resolution Process (CIRP). SBI had sanctioned various loans and credit facilities to Visa Steel between August 18, 2006, and August 31, 2009. Visa Steel defaulted on these payments, leading to a Master Restructure Agreement (MRA) on December 19, 2012, with a consortium of banks led by SBI. Visa Steel continued to default, and the account was declared a Non-Performing Asset (NPA) with the date backdated to July 11, 2012. SBI filed the petition before NCLT, Kolkata, on December 21, 2017. Visa Steel challenged the maintainability of the petition,

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## Issues and analysis

### Issue 1: Whether the petition is …

**Ratio:** Section 18 of the Limitation Act states that acknowledgement of debt before the expiry of

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**Reasoning:** The court reasoned that the corporate debtor acknowledged the debt in its financial

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**Interpretation:** The interpretation of Section 18 of the Limitation Act, as applied to IBC

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**Application:** In this case, the corporate debtor committed default on 11.07.2012, and the

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## Parties

- **Judges:** P. Moha…; Satya Ranjan…
- **Appellants:** State Bank of…
- **Respondents:** Visa Steel…
- **Advocates:** Arun Kath…; Siddharatha…; +6 more

## Timeline

- **2006-08-18 — Loan San…**: Financial creditor sanctioned…
- **2009-08-31 — Loan San…**: Financial creditor sanctioned…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 19 — Personnel to extend co-operation to interim…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-19)

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