# In the matter of Asset Reconstruction Company (India) Limited vs. Tulip Star Hotels Limited & Ors.

> SC judgment dated 2022-08-01. Citation: TCN-2022-SC-00035. The appeals were filed under Section 62 of the Insolvency and Bankruptcy Code 2016 (IBC) by Asset…

- **Court:** SC
- **Order date:** 1 Aug 2022
- **Citation:** TCN-2022-SC-00035
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/supreme-court-of-india/asset-reconstruction-company-india-limited-vs-tulip-star-hotels-limited-ors-ac8e6c8c

## Summary

### Background

The appeals were filed under Section 62 of the Insolvency and Bankruptcy Code 2016 (IBC) by Asset Reconstruction Company (India) Limited, the Financial Creditor, against a common judgment and final order dated 11th December 2019 passed by the National Company Law Appellate Tribunal (NCLAT). The NCLAT allowed Company Appeal (AT)(Insolvency) No.525 of 2019 and Company Appeal(AT) (Insolvency) No.627 of 2019, holding that the Corporate Insolvency Resolution Process (CIRP) initiated by the Appellant against the Corporate Debtor, V. Hotels Ltd., was barred by limitation. The NCLAT had set aside the order of the Adjudicating Authority (NCLT) which had admitted the application of the Appellant under Section 7(5)(a) of the IBC.

## Facts

1. A loan agreement was executed on or about 8th March 2002 between a consortium of banks led by Bank of India and V. Hotels Ltd. (Corporate Debtor) for Rs.129,00,00,000/-.
2. On 5th June 2003, the Corporate Debtor entered into an arrangement with Abu Dhabi Commercial Bank (ADCB) for USD 29,000,000/- to repay the consortium loan.
3. In August/September 2008, a bank guarantee issued by Bank of India in favor of ADCB on behalf of the Corporate Debtor was invoked, and Bank of India paid Rs.24,49,59,208/- to ADCB.
4. On 1st December 2008, the Corporate Debtor's account in Bank of India was classified as a non-performing asset (NPA).
5. On 31st December 2008, Bank of India assigned its receivables to Asset Reconstruction Company (India) Limited (Appellant).
6. On 7th February

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## Issues and analysis

### Issue 1: Whether the application filed by the Appellant under …

**Ratio:** Section 238A of the IBC, read with Article 137 of the Limitation Act, prescribes a

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**Reasoning:** The Court reasoned that the Corporate Debtor had acknowledged its liability in its

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**Interpretation:** The Court interpreted Section 238A of the IBC and Section 18 of the Limitation

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**Application:** The Court applied the ratio to the facts by noting that the Corporate Debtor's

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## Parties

- **Judges:** INDIRA BA…; J.K. MAHE…
- **Appellants:** Asset Reconstructi…
- **Respondents:** V Hotels…; Tulip Star Hotels…

## Timeline

- **2002-03-08 — Loan Agre…**: A loan agreement was executed between a consortium of banks and V. Hotels Ltd. for…
- **2003-06-05 — Arrangement w…**: V. Hotels Ltd. entered into an arrangement with Abu Dhabi Commercial Bank (ADCB) for USD…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 62 — Appeal to Supreme Court](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-62)

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