# In the matter of A. Navinchandra Steels Private Limited Vs. SREI Equipment Finance Limited & Ors. Civil Appeal Nos.4230-4234 Of 2020

> SC judgment dated 2021-03-01. Citation: TCN-2021-SC-00070. The appeal arises from a judgment dated 07.02.2020, corrected on 21.09.2020, by the NCLAT. A.…

- **Court:** SC
- **Order date:** 1 Mar 2021
- **Citation:** TCN-2021-SC-00070
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/supreme-court-of-india/a-navinchandra-steels-private-limited-vs-srei-equipment-finance-limited-ors-civi-b2c0f8f7

## Summary

### Background

The appeal arises from a judgment dated 07.02.2020, corrected on 21.09.2020, by the NCLAT. A. Navinchandra Steels Private Limited, the appellant, is an operational creditor of Shree Ram Urban Infrastructure Limited (SRUIL), the respondent. SRUIL is under winding up and has a decree dated 07.10.2015 in favor of the appellant, passed by the Bombay High Court. An execution application was filed by the appellant before the Bombay High Court. A winding up petition was filed by the appellant against SRUIL in 2015. Another winding up petition was filed by Action Barter against SRUIL, which was admitted conditionally. Indiabulls Housing Finance Ltd., a secured creditor of SRUIL, filed a petition under Section 7 of the IBC before the NCLT, which was dismissed. The Supreme Court

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## Facts

A. Navinchandra Steels Private Limited, the appellant, is an operational creditor of Shree Ram Urban Infrastructure Limited (SRUIL). SRUIL is under winding up proceedings in the Bombay High Court, initiated before the IBC proceedings. The appellant holds a decree dated 07.10.2015 against SRUIL. Indiabulls Housing Finance Ltd., a secured creditor, initiated SARFAESI proceedings and sold mortgaged property of SRUIL to Honest Shelters Pvt. Ltd. This sale is contested in the Bombay High Court. SREI Equipment Finance Limited, the respondent, initiated Section 7 proceedings under the IBC before the NCLT, which were admitted. The appellant challenges the maintainability of the Section 7 petition, arguing that the existing winding up proceedings bar such action. Action Barter,

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## Issues and analysis

### Issue 1: Whether a Section 7 petition under the IBC is maintainable when winding up proceedings are already …

**Ratio:** A petition under Section 7 of the IBC is an independent proceeding, unaffected by pending

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**Reasoning:** The court relies on a catena of judgments establishing that Section 7 proceedings are

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**Interpretation:** The IBC, as a special statute with a non-obstante clause (Section 238),

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**Application:** The court applies this principle to the present case, stating that the pending

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## Parties

- **Judges:** ROHINTON FALI…; B.R. G…
- **Appellants:** A.Navinchandra…
- **Respondents:** SRUI…; SREI Equipment…

## Timeline

- **2014-01-01 — Summary…**: Summary Suit No.626 of 2014…
- **2015-01-01 — Winding Up P…**: Appellant filed a winding up petition, Company Petition No.1039 of 2015 against SRUIL…

## 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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