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2025 Supreme(Online)(NCLT) 805
NATIONAL COMPANY LAW TRIBUNAL
Shammi Khan, J, Sanjeev Kumar Sharma, T
Bank of India – Appellant
Versus
MP Agro BRK Energy Foods Pvt Ltd – Respondent
TP(IB) 200 of 2019 | CP(IB) 548 of 2018
For the Appellants/Petitioners: Ms. Darshana Baghel
For the Respondents: Mr. Sanyat Lodha
The judgment establishes that a financial creditor's claim of default exceeding Rs. 1 Crore warrants the initiation of corporate insolvency resolution, irrespective of the corporate debtor's disputes regarding NPA classification.
Headnote:(A) Insolvency and Bankruptcy Code, 2016 - Section 7, Rule 4 - Initiation of Corporate Insolvency Resolution Process - Application filed by financial creditor claiming default of Rs. 11,57,89,697/- - Corporate debtor challenges default classification due to alleged incorrect NPA designation - Court finds financial debt established and default occurred on 30.09.2017 as evidenced by bank documents and statements - Appeal by corporate debtor dismissed; application allowed for CIRP initiation - IRP appointed and moratorium declared. (Paras 18-26)
(B) Financial Debt and Default - Definition and maintenance - NPA classification is valid based on existing RBI regulations despite corporate debtor’s objections regarding MSME benefit. (Paras 16.1-16.19)
(C) Debtor's obligations under IBC - Corporate debtor must ensure repayment and maintain accounts within limits; failure to do so establishes default. (Paras 16.1-16.19)
(D) Court's findings - Evidence of substantial default exceeding Rs. 1 Crore; application as per procedural rules and within limitation period - Adjudicating authority reaffirmed to examine debt and default, irrespective of NPA classification disputes. (Paras 17.1-17.4)
| Table of Content |
|---|
| 1. filing details and procedural adherence for cirp application. (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8) |
| 2. disputes over npa classification and default evidence. (Para 9 , 10 , 11 , 12) |
| 3. court's analysis of financial debt existence and default. (Para 13 , 14 , 15 , 16 , 17) |
| 4. determination of maintainability and timeliness of application. (Para 18 , 19 , 20) |
| 5. admission of cirp and appointment of irp. (Para 24 , 25 , 26) |
ORDER
(Per: BENCH)
1. This is an application filed on 22.10.2018 by Bank of India (hereinafter referred to as “the Applicant/ Financial Creditor”) against MP Agro BRK Energy Foods Private Limited (hereinafter referred to as “the Respondent/Corporate Debtor”) under Section 7 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as “IBC, 2016”) read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 for initiation of Corporate Insolvency Resolution Process (CIRP) against the Respondent/Corporate Debtor, to appoint Interim Resolution Professional (hereinafter referred to as “IRP”) and declare the moratorium for having defaulted payment of its outstanding dues Rs. 11,57,89,697/- [Principal 10,43,09,697 + Interest Rs. 1,14,80,000].
2. The application is affirmed by Mr. Sridhar Seshadri, Authorized officer of the Financial Creditor, who is authorized under Authority letter marked as Annexure-B.
3. Perusal of of Part-I of the Form-1 indicates that the Applicant/Financial Creditor is a Bank. The registered office of the Financial Creditor is situated at UG 2,3,4 Om Gurudev Complex, Scheme No. 540, Opp. Rajshri Appollo Hospital, Vijay Nagar, Indore, Madhya Pradesh - 452010.
4. Perusal of Part-II of the Form-1 reveals that the Respondent/Corporate Debtor is MP Agro BRK Energy Foods Private Limited (CIN: U15410MP2007PLC019486). The date of incorporation is 26.04.2007. The registered office of the Respondent/Corporate Debtor is situated at Plot No. 71(B&C), Industrial Area No. 1, A.B. Road, Dewas, Madhya Pradesh - 455001.
5. Perusal of Part-III of the Form-1 reveals that the Applicant/Financial Creditor initially nominated the name of Ms. Teena Sarawat Pandey, having Registration No. IBBI/IPA- 001/IP-P00652/2017-18/11126 under section 13 (1)(c) of the Code to act as Interim Resolution Professional (IRP). Later, vide order dated 24.03.2023, the proposed IRP was replaced through I.A. 89(MP)/2023 with Ms. Chaya Gupta due to the original IRP‟s conflict of interest, having Registration No. IBBI/IPA-002/IP-N00984/2020-2021/13133. (Email: guptachayacs@gmail.com) under section 13 (1)(c) of the Code to act as Interim Resolution Professional (IRP). She has filed her written communication annexed with the Petition as Form-2 as per the requirement of Rule 9(l) of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016. Her AFA is valid up to 30.06.2025 as per data available on the official website of the IBBI ibbi.gov.in.
6. She has filed her written communication annexed with the Application as per the requirement of Rule 9(l) of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016.
7. Perusal of Part-IV of the Form-1 reveals that the Applicant/Financial Creditor has granted various credit facilities and the total amount in default is claimed to be Rs. 11,57,89,697/- including interest. The date of default is mentioned as 30.09.2017.
8. It is stated that the copy of notice dated 06.11.2017 under Section 13 (2) of the SARFAESI Act and possession notice dated 17.09.2018 for existence of the financial debt, the amount and date of default and the same is annexed as Annexure-I
9. The application filed under Section 7 of the IBC, 2016 was admitted by this Adjudicating Authority vide order dated 05.03.2020 for initiation of CIRP against the Corporate Debtor. The said order was challenged by the Corporate Debtor by filing an appeal before the Hon‟ble NCLAT. Following which vide order dated 14.11.2022, the Hon‟ble NCLAT rem
