# The South Indian Bank Limited vs. M/s Royal Dry Fruits Private Limited

> NCLT judgment dated 2026-07-07. Citation: TCN-2026-NCLT-00745. The South Indian Bank Limited (Financial Creditor) filed an application under Section 7 of the…

- **Court:** NCLT
- **Order date:** 7 Jul 2026
- **Citation:** TCN-2026-NCLT-00745
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-mumbai/the-south-indian-bank-limited-vs-ms-royal-dry-fruits-private-limited-m8cyn

## Summary

### Background

The South Indian Bank Limited (Financial Creditor) filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) against M/s Royal Dry Fruits Private Limited (Corporate Debtor) for the initiation of Corporate Insolvency Resolution Process (CIRP). The Financial Creditor claimed a default of Rs. 9,95,60,745.61/-, including interest, arising from various credit facilities extended to the Corporate Debtor since 2016. The Corporate Debtor's accounts were classified as Non-Performing Assets (NPA) on July 29, 2024. The Corporate Debtor disputed the default and the quantum of debt, citing parallel proceedings under the SARFAESI Act, 2002, and alleging undervaluation of mortgaged properties sold by the Financial Creditor.

## Facts

The South Indian Bank Limited (Applicant/Financial Creditor) filed an application under Section 7 of the IBC against M/s Royal Dry Fruits Private Limited (Respondent/Corporate Debtor).

The claimed amount in default is Rs. 9,95,60,745.61/-, including interest, with a principal outstanding of Rs. 7,01,55,646.00/-.

The Financial Creditor is a banking company incorporated under the Companies Act, 1913, and engaged in banking business under the Banking Regulation Act, 1949.

In 2016, the Corporate Debtor approached the Financial Creditor for credit facilities, which were sanctioned for an aggregate of Rs. 9,90,00,000/- (Cash Credit Open Loan, Term Loan, and Import Letter of Credit).

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## Issues and analysis

### Issue 1: Whether a financial debt exists …

**Ratio:** The Financial Creditor, a banking company, extended various credit facilities to the

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**Reasoning:** The Applicant provided comprehensive documentary evidence, including Sanction Letters,

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**Interpretation:** A 'financial debt' is established by the contractual obligation to repay funds

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**Application:** The NCLT found that a financial debt exceeding the threshold of Rs. One Crore

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## Parties

- **Judges:** NILESH S…; SAMEER…
- **Appellants:** The South Indian…
- **Respondents:** M/s. Royal Dry…
- **Other parties:** CoC…; Sameer Abdulhusein…; +2 more
- **Advocates:** Ayush R…; Anurag M…; +6 more

## Timeline

- **2016 — Credit Facilities…**: The Corporate Debtor approached the…
- **2016-07-20 — Initial Sanction Letter…**: The Financial Creditor sanctioned facilities aggregating to ₹9,90,00,000/-. The Corporate…

## 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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